<PAGE>
<PAGE>

                        SECURITIES AND EXCHANGE COMMISSION
                                 Washington, D.C.

                                    FORM 10-K

   (Mark One)

   [X]          ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                           SECURITIES EXCHANGE ACT OF 1934

                     For the fiscal year ended December 28, 1996

                                          OR

   [ ]         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                                SECURITIES ACT OF 1934 

                           Commission File Number 0-20001

                           NATIONAL VISION ASSOCIATES, LTD.
                  (Exact name of Registrant as specified in its charter)

                                         Georgia
                             (State or other jurisdiction of
                              incorporation or organization)

                                        58-1910859
                           (I.R.S. Employer Identification No.)

                                   296 Grayson Highway
                                  Lawrenceville, Georgia
                        (Address of principal executive offices)

                                          30245
                                        (Zip Code)

         Registrant's telephone number, including area code:  (770) 822-3600

               Securities registered pursuant to Section 12(b) of the Act:

                                            None


                                    Page 1 of 58<PAGE>
<PAGE>

               Securities registered pursuant to Section 12(g) of the Act:

                         Common Stock, par value $.01 per share

                                    (Title of Class)

     Indicate by check mark whether the registrant (1) has filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange Act 
of 1934 during the preceding 12 months (or for such shorter period that the 
registrant was required to file such reports), and (2) has been subject 
to such filing requirements for the past 90 days.         Yes   X    No    
                                                              -----     -----

     Indicate by check mark if disclosure of delinquent filers pursuant to 
Item 405 of Regulation S-K is not contained herein, and will not be contained, 
to the best of registrant's knowledge, in definitive proxy or information 
statements incorporated by reference in Part III of this Form 10-K or any 
amendment to this Form 10-K.                              [  ] 

     The number of shares of Common Stock of the registrant outstanding as 
of February 3, 1997, was 20,651,359.  The aggregate market value of shares 
of Common Stock held by non-affiliates of the registrant as of February 3, 
1997, was approximately $84.3 million based on a closing price of $4.875 
on the NASDAQ Stock Market on such date.  For purposes of this computation, 
all executive officers and directors of the registrant are deemed to be 
affiliates.  Such determination should not be deemed to be an admission 
that such directors and officers are, in fact, affiliates of the registrant.

                   DOCUMENTS INCORPORATED BY REFERENCE

     Portions of the following documents have been incorporated by reference 
into the parts indicated: the Company's definitive Proxy Statement for the 
1997 Annual Meeting of Shareholders to be filed with the Securities and 
Exchange Commission not later than 120 days after the end of the fiscal year 
covered by this report--Part III.

              The Exhibit Index is located at pages 23 - 28.


                                    Page 2 of 58<PAGE>
<PAGE>

                                       PART I

ITEM 1.   BUSINESS

     National Vision Associates, Ltd. (the "Company") is engaged in the 
retail sale of optical goods and services as a licensee operating within 
discount department stores.  Pursuant to an agreement (the "Wal-Mart 
Agreement") with Wal-Mart Stores, Inc. ("Wal-Mart"), the Company operates, 
as of February 3, 1997, 328 retail vision centers in stores owned and 
operated by Wal-Mart.  As of the same date, the Company also operates 18 
vision centers in Mexico pursuant to a license agreement (the "Mexico 
Agreement") with Wal-Mart de Mexico, S.A. de C.V. ("Wal-Mart Mexico").

     The Company also owns fifty percent of a joint venture company which 
operates three locations in Eastern Europe in department stores owned by 
Tesco, PLC.  (The Company has previously announced that it intends to 
sell its interest in the joint venture.)  

     The discussion in this "Business" section relates only to the 
Company's domestic business, except where expressly stated to the 
contrary.  See "Mexican Operations" below for a description of the 
Company's Mexican operations and how they differ from the Company's 
domestic business.

MARKETING STRATEGY

     The Company generally employs a marketing philosophy of offering 
quality and value at "everyday low prices" with "customer satisfaction 
guaranteed."  Management constantly strives to identify new means of 
accomplishing its overall goal of being a low-cost provider of quality 
retail optical products.

VISION CENTER OPERATIONS

     Each of the Company's existing Wal-Mart vision centers occupies 
approximately 1,000 square feet in the front of the host store, with 
separate areas for merchandise display, customer service, contact lens 
fitting and a laboratory.  Services of independent optometrists are 
available from clinics which are approximately 500 square feet and located 
in, adjacent to, or nearby the vision center, depending on regulatory 
requirements.  Each vision center has a laboratory containing a patternless 
edging and fitting unit and other equipment that, coupled with the on-site 
inventory of frames, spectacle lenses, and contact lenses, allows the 
Company to give prompt, one-hour service to many customers who request 
quick delivery.  In each vision center, the Company maintains an 
on-premises inventory of approximately 1,250 eyeglass frames, 1,380 
pairs of spectacle lenses, and 850 pairs of contact lenses, together 
with assorted sunglasses, eyeglass cases, eyeglass accessories, and 
contact lens accessories.  


                                    Page 3 of 58<PAGE>
<PAGE>

OPTICAL PROFESSIONALS

     A key element of the Company's business strategy is the availability 
of independent optometrists at clinics in, adjacent to, or nearby the 
Company's vision centers.  Additionally, the Wal-Mart Agreement requires 
that such services be available for a minimum of 48 hours per week to the 
extent permitted by applicable law.  These optometrists, whose activities 
and relationships with entities such as the Company are subject to state 
and local regulation, are not employed by, and receive no compensation from, 
the Company.  See "Government Regulation."  Such independent optometrists 
sublicense the eye examination facilities and equipment from the Company.

     In January 1997, the Company completed various transactions related to
its relationship with each of Eyecare Leasing, Inc., which had previously
recruited optometrists for the Company pursuant to a consulting agreement
and Stewart-Phillips, Inc., which had recruited optometrists practicing 
adjacent to the Company's vision centers in California.  The transactions 
involved the termination of such consulting agreement and transfer of 
the responsibilities of Stewart-Phillips, Inc. to a subsidiary of the 
Company.  (See Note 15 to consolidated financial statements.)

MANAGEMENT INFORMATION AND FINANCIAL SYSTEMS

     In 1996, the Company completed the installation of a new point of sale
system and a new perpetual inventory system in all domestic store locations.  
The system facilitates the processing of customer sales information and 
replenishment of store inventory by passing such information, including 
customer specific orders, to the Company's home office and Company in-house 
lens laboratory for further processing.

RELATIONSHIP WITH HOST COMPANIES

     Master Agreements
     -----------------

     The Company's relationship with each of Wal-Mart and Wal-Mart Mexico 
is governed by a master license agreement which grants a separate license 
to the Company for each vision center.  Each agreement provides for the 
payment of minimum and percentage license fees and contains other customary 
terms and conditions.  Certain terms are described below:


                                    Page 4 of 58<PAGE>
<PAGE>
<TABLE>
<CAPTION>

                                 Term of         Company
                               Each License      Options             Other
                               ------------      -------             -----

<S>                             <C>              <C>                   <C>
Wal-Mart                                         one for
 Agreement                      9 yrs.           three yrs.            1

Mexico
 Agreement                      5 yrs.           two for two           2
                                                 yrs.; one
                                                 for one yr.

</TABLE>

(1)  The Wal-Mart Agreement provides that Wal-Mart is to offer the Company 
     the opportunity to open, no later than May 1, 1998, at least 400 vision 
     centers (including those currently open).  In January 1995, the Company 
     made a lump sum payment in exchange for such commitment.  Such payment 
     is being amortized over the initial term of vision centers opened after 
     January 1, 1995.  

(2)  The Company has a right of first refusal in Mexico for any store in which 
     Wal-Mart Mexico proposes to open a vision center.  The Mexico Agreement 
     contains a mutual non-competition agreement preventing each party from 
     dealing with other parties (excluding affiliates of the Company and 
     Wal-Mart Mexico) in Mexico for the operation of vision centers in a host
     environment.  The Mexico Agreement also contains provisions which 
     entitle each party to terminate the license for each vision center if
     such vision center fails to meet certain minimum sales requirements.

     No Assurances of Expansion
     --------------------------

     Future additional expansion in stores of any of the Company's hosts 
beyond those currently under contract is out of the control of the Company 
and there can be no assurance that any host will offer the Company any 
additional vision centers or that any such offer will be on terms that are 
the same as or similar to the terms contained in the current agreements.  
Management periodically discusses expansion opportunities with each host, 
but there can be no assurance that these discussions will result in 
additional vision centers being offered to the Company.  

                                    Page 5 of 58<PAGE>
<PAGE>

     Manufacturing and Distribution
     ------------------------------

     The Company currently utilizes two in-house lens laboratories and 
one independent laboratory to manufacture prescription eyeglasses for its 
vision centers.  Substantially all prescription spectacle requirements 
of the Company's domestic vision centers opened in the future will be 
supplied from Company-owned laboratories.  The Company has a state-of-
the-art coating facility in its Lawrenceville headquarters, capable of 
coating lenses with anti-reflective and mirror surfaces.  Each vision 
center has its own finishing laboratory which manufactures lenses for 
approximately half of all customers purchasing spectacle lenses.

     The Company's centralized distribution center in its Lawrenceville, 
Georgia headquarters facility provides lens blanks, frames, sunglasses 
and contact lenses to all vision centers.  The Company's central 
distribution center and all laboratories are interfaced with the Company's 
management information system.  The Company's central distribution center 
replenishes inventory, including frames, and spectacle and contact lenses, 
to the Company's vision centers throughout the United States by overnight 
delivery services.  Completed prescription glasses and spectacle lenses are 
sent by overnight delivery services to the vision centers through the 
distribution center from the Company's in-house laboratories and outside 
laboratory.

     Government Regulation
     ---------------------

     The Company is subject to a variety of federal, state, and local 
laws, regulations, and ordinances, including state and local laws and 
regulations regarding advertising, zoning, qualifications and practices of 
the opticians employed by the Company, relations between independent 
optometrists and optical firms such as the Company, and various trade 
practices such as country of origin product labeling.  In addition, 
certain of the Company's products, specifically contact lenses and 
contact lens solutions, must comply with quality control standards 
set by the United States Food and Drug Administration.  The Company 
believes it is in substantial compliance with all material governmental 
regulations applicable to its operations.  
         


                                    Page 6 of 58<PAGE>
<PAGE>
     Although government regulation has increased the cost to the 
Company of commencing operations and decreased its flexibility in managing 
its business, government regulation has not, to date, had a material 
adverse effect on the Company's overall operations or financial 
performance, or on its overall relationships with independent optometrists.  
It is nevertheless possible that new regulations or new interpretations of 
current regulations could materially increase the Company's cost of doing 
business or have a material adverse impact on the Company's sales by 
restricting or eliminating the services of an optometrist in, adjacent to, 
or nearby the Company's vision centers.  This risk is enhanced since the 
Company's competitors often serve as, or exert influence on, local regulators 
of the eyecare industry.

     Competition
     -----------

     The retail eyecare industry in the United States is highly 
competitive.  In addition to optical chains such as Pearle Vision and 
LensCrafters, and other department store chains such as Sears Roebuck 
(through its Sears Optical Center locations), there are numerous retail 
optical stores, individual retail outlets and individual opticians, 
optometrists, and ophthalmologists providing the public all or some of the 
goods and services the Company sells or makes available through its vision 
centers.  Optical retailers generally serve individual, local or regional 
markets, and, as a result, competition is fragmented and varies substantially 
among locations and geographic areas.  Several of the Company's competitors 
have financial resources substantially greater than those of the Company.

     The Company believes that its primary competitive advantages are its 
locations in a prominent position in its host stores, its quality products 
and value at low prices, and its customer-driven service philosophy.  
Additionally, the Company competes on the basis of the quality and 
consistency of service, convenience, speed of delivery, and selection.

     Wal-Mart operates its own optical division.  As of February 3, 1997, 
such division operated approximately 600 vision centers.  No assurance can 
be given that Wal-Mart will not continue to allocate increasing numbers of 
vision centers to its own optical division.

     The Company's future ability to expand in the United States outside 
of the Wal-Mart chain is limited by the potential adverse impact on the 
Company's relations with Wal-Mart that may result from any Company 
competition with any Wal-Mart optical center.  The Company regularly 
explores opportunities to expand outside of Wal-Mart and, depending on
the circumstances, would consider a variety of options such as expanding
in another host environment, opening free standing vision centers, and 
acquiring an optical chain.

                                    Page 7 of 58<PAGE>
<PAGE>
     Mexican Operations
     ------------------

     OPERATIONS.  In general, the Company's vision centers in stores owned 
by Wal-Mart Mexico are laid out, equipped, and operated in substantially 
the same manner as the Company's domestic vision centers.  On-site inventory 
consists of a similar product mix as in the Company's domestic vision 
centers.  The Mexican operation is currently sourcing a majority of its 
inventory requirements locally and distributing products through its locally 
operated distribution center.  The Mexican operation will consider increasing 
its existing lens processing and distribution center operations in Mexico 
if the number of vision centers in operation grows to a level that would 
justify such operations.  Basic merchandising and marketing methods used 
in Mexico are comparable to those used by the Company in its domestic 
operations, though these techniques are modified as needed to reflect 
cultural and national differences.

     REGULATORY ENVIRONMENT.  The Company's Mexican operations are subject 
to regulatory environments that are different in many ways from (and less 
extensive than) the regulations currently applicable to the Company's 
United States operations.  

     RISKS.  The Company's Mexican operations face risks substantially 
similar to those faced by the Company in connection with its domestic 
operations, including dependence on the host store and expansion 
requirements.  There can be no assurance that such operations will be 
able to attain profitability.  In addition, such operations expose the 
Company to all of the risks arising from investing and operating in 
foreign countries generally, including a different regulatory, political, 
and governmental environment, currency fluctuations, currency devaluations, 
inflation, price controls, restrictions on profit repatriation, lower per 
capita income and spending levels, import duties and other impediments to 
the delivery of inventory and equipment to vision center locations, 
value-added taxes, and difficulties of cross-cultural marketing.  

     ECONOMIC AND POLITICAL ENVIRONMENT.  Regulations in Mexico do not 
currently include currency controls, restrictions on profit repatriation, 
limitations on foreign ownership, or restrictions on sourcing of products 
that would adversely affect the Company's operations.  The cumulative 
translation adjustment in shareholders' equity for operations in foreign 
countries at December 28, 1996 was approximately $4.1 million. 


                                    Page 8 of 58<PAGE>
<PAGE>
     As a result of devaluation of the peso in prior years, the Company 
has in the past adjusted its retail pricing.  Further pricing adjustments 
are contingent upon competitive pricing levels in the marketplace.  
Management is monitoring the continuing impact of this devaluation and 
the resulting inflationary trends.

     The Securities and Exchange Commission has qualified Mexico as a highly 
inflationary economy under the provisions of SFAS No. 52 - Foreign Currency 
Translation.  Consequently, in 1997, the financial statements of the
Mexico operation will be remeasured with the U.S. dollar as the functional
currency.  Any gain or loss resulting from changes in foreign currency rates
between the peso and the U.S. dollar, as calculated in the remeasurement
process, will be recorded in the Company's statement of operations.

     Trade Names and Trademarks
     --------------------------

     In connection with its Wal-Mart vision centers, the Company must use 
the tradename "Vision Center located in Wal-Mart" and indicate that the 
vision centers are operated by the Company.  Vision centers in stores owned 
by Wal-Mart Mexico do business under the name "Centro de Vision."  The 
Company also has licensed the right to use the "Gitano" and "Guy Laroche" 
trademarks in its domestic vision centers pursuant to license agreements 
providing for royalty payments and containing other customary terms and 
conditions.  The Gitano and Guy Laroche agreements expire on June 30, 1997 
and December 31, 1998, respectively, and each agreement may be renewed, 
subject to various conditions.  Discussions concerning renewal of the 
Gitano agreement and renegotiation of the Guy Laroche agreement are in
progress.

     Employees
     ---------

     As of December 28, 1996, the Company employed approximately 1,533 
associates on a full-time basis and 542 associates on a part-time basis, 
of whom approximately 1,847 were engaged in retail sales, 114 in laboratory 
and distribution operations, and 114 in management and administration.  
Apart from its Mexican employees, none of the associates employed by the 
Company is covered by any collective bargaining agreements.  All associates 
(with the exception of home office personnel) employed in the Company's 
Mexican operations are covered by collective bargaining agreements.  The 
Company considers its employment relations to be good, and to date the 
Company has not experienced any significant difficulties in staffing its 
vision centers.



                                    Page 9 of 58<PAGE>
<PAGE>

     Foreign and Domestic Operations
     -------------------------------

     See Note 14 to the consolidated financial statements contained 
elsewhere in this report for additional information regarding the 
Company's foreign and domestic operations.

ITEM  2.   PROPERTIES

     The Company's 328 domestic vision centers in operation as of 
February 3, 1997 are located in the following states:

Alabama                5              New Jersey              11
Alaska                 3              New Mexico               7
Arizona               14              New York                26
California            75              North Carolina          34
Colorado               8              North Dakota             4
Connecticut            5              Oregon                   9
Georgia               33              Pennsylvania            18
Hawaii                 4              South Carolina          10
Kansas                 6              South Dakota             1
Louisiana              1              Tennessee                1
Maryland               1              Texas                    6
Massachusetts          4              Virginia                19
Minnesota              1              Washington               3
Montana                2              West Virginia            5
Nevada                 7              Wyoming                  1
New Hampshire          4


     The Company's foreign vision centers in operation as of February 3, 
1997 are located in the following countries:  

                  Czech Republic and Slovakia         3
                  Mexico                             18

     The Company's home office is located in approximately 66,000 square feet 
of space in Lawrenceville, Georgia, and is subleased from Wal-Mart through 
the year 2001 (with an option to renew for approximately seven additional 
years) at a monthly lease rate of approximately $17,000.  The Company's 
Lawrenceville headquarters also hosts a training center, the Company's 
central distribution center, an anti-reflective and mirror coating facility, 
and a lens laboratory.   

     The Company's Los Angeles laboratory is also held under lease, which 
expired in January 1997.  Discussions concerning an extension are in progress.

                                    Page 10 of 58<PAGE>
<PAGE>
ITEM 3.   LEGAL PROCEEDINGS

     The Company is not currently a party to any legal proceedings the result 
of which management believes could have a material adverse effect upon its 
business or financial condition.  The Company is currently the defendant 
in a lawsuit (Commercial Court of Paris, Case No. RG 95 108253) in France 
arising out of the Company's sale of its French operations.  The suit was 
initiated on December 6, 1995 by Grand Optical Photoservice, S.A. ("GPS") 
to block the Company's sale of its French operations to a third party.  GPS 
claims that, in selling its French operations to a third party, the Company 
breached a letter of intent it had previously signed with GPS.  By a decision 
dated December 14, 1995, the trial court rejected the plaintiff's claims 
and fined the plaintiff for filing a frivolous claim.  The plaintiff has 
filed an appeal.  The Company believes that the plaintiff's claims are 
without merit.

     The Company received a deficiency notice (dated September 11, 1996) 
from the Internal Revenue Service claiming, for the 1992 tax year, that a 
deficiency in the amount of $228,531 is owed to the Internal Revenue Service, 
that the Company was not entitled to a certain deduction in the amount of 
$4,353,367 (relating to the exercise of certain stock options - see Note 5 
to consolidated financial statements), and that the Company was subject to 
the alternative minimum tax.  The Company vigorously disputes these 
allegations, is of the opinion that they are without merit, and has 
retained counsel to contest the deficiency notice.  Through its counsel, 
the Company filed a petition in October 1996 in the U.S. Tax Court (Docket 
No. 23670-96), contesting the deficiency notice.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matters were submitted to a vote of security holders during the last 
quarter of fiscal 1996.



                                    Page 11 of 58<PAGE>
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                                           PART II

ITEM 5.   MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

     The Company's Common Stock is traded on the NASDAQ National Market System 
under the symbol "NVAL".

     The following table sets forth for the periods indicated the high and low 
closing prices of the Company's Common Stock in the over-the-counter market on 
the NASDAQ National Market System.

<TABLE>
<CAPTION>


         Quarter Ended                             High           Low 
         -------------                             ----           ---
         <S>                                       <C>           <C>
         1995   April 1                            $5.125        $3.50 
                July 1                             $5.75         $3.75 
                September 30                       $4.375        $3.75 
                December 30                        $4.25         $2.875

         1996   March 30                           $3.625        $2.50
                June 29                            $5.125        $3.00 
                September 28                       $5.125        $4.00 
                December 28                        $4.5625       $3.25 

</TABLE>
     As of February 3, 1997, there were approximately 700 holders of record 
of the Company's Common Stock, including shares held in nominee or street 
name by brokers.

     It is the present intention of the Company's board of directors not 
to pay dividends but rather to use the Company's cash resources for the 
expansion of its operations and repayment of the Company's revolving credit 
facility.  Future dividend policy will depend upon the earnings and 
financial condition of the Company, the Company's need for funds, and 
other factors.



                                    Page 12 of 58<PAGE>
<PAGE>
ITEM 6.   SELECTED FINANCIAL DATA

     The following selected financial data of the Company with respect to 
the consolidated financial statements for the years ended December 31, 
1992, 1993, 1994, December 30, 1995 and December 28, 1996 is derived from 
the Company's consolidated financial statements.  The selected financial 
data set forth below should be read in conjunction with the consolidated 
financial statements and notes thereto included elsewhere herein.   For 
information on dispositions of certain business operations, see Note 13 
to consolidated financial statements.
<TABLE>
<CAPTION>
                                                     Year Ended December 31,         December 30,      December 28,
                                                ------------------------------       ------------      ------------
                                                1992       1993       1994 (1)         1995 (2)            1996
                                                ----       ----       --------         --------            ----
                                                  (000's except per share information and statistical data)
<S>                                            <C>        <C>         <C>              <C>               <C>
STATEMENTS OF OPERATIONS DATA:
Net Sales                                      $48,141    $88,340     $119,395         $145,573          $160,376
Cost of Goods Sold                              21,180     41,445       53,898           67,966            76,692
                                               -------    -------     --------         --------          --------
Gross Profit                                    26,961     46,895       65,497           77,607            83,684
Gross Profit Percentage                            56%        53%          55%              53%               52%
Selling, General, and Administrative 
  Expenses                                      24,500     48,602       63,911           74,390            76,920
Provision for Dispositions (3)                      --      7,727           --              958                --
Other Nonrecurring Charges (3)                      --      2,750           --            1,053                --
Stock Compensation Expense                          39        834           --               --                --
                                               -------    -------     --------         --------          --------
Operating Income (Loss)                          2,422    (13,018)       1,586            1,206             6,764
Other Income (Expense), Net                       (452)       154       (1,195)          (2,626)           (2,084)
                                               -------    -------     --------         --------          --------
Income (Loss) Before Income Taxes                1,970    (12,864)         391           (1,420)            4,680
Income Tax Benefit (Expense) (4)                  (710)       900          (40)            (100)           (1,200)
                                               -------    -------     --------         --------          --------
Net Income (Loss)                              $ 1,260   $(11,964)    $    351         $ (1,520)         $  3,480
                                               =======   ========     ========         ========          ========
Net Income (Loss) Per Common Share (5)         $   .07   $   (.59)    $    .02         $   (.07)         $    .17
                                               =======   ========     ========         ========          ========

Earnings before Interest, Taxes,               $ 5,628   $ (7,506)    $  9,153         $ 11,584          $ 16,816
  Depreciation and Amortization
As a Percentage of Sales                         11.7%      -8.5%         7.7%             8.0%             10.5%

STATISTICAL DATA (UNAUDITED):
Domestic Vision Centers Open at 
  End of Period                                    128        186          261              319               320
Mexico and Eastern Europe Vision 
  Centers Open at End of Period                      2         19           30               26                21
Average Weekly Consolidated Sales
  Per Vision Center (6)                        $10,562    $10,224      $ 9,455           $8,685            $9,311
Average Weekly Sales Per Domestic
  Vision Center (6)                            $10,562    $11,029      $10,067           $9,105            $9,635
Average Weekly Sales Per Vision Center
  in Mexico and Eastern Europe (6)                  --    $ 6,801      $ 4,056           $2,874            $3,890
</TABLE>
                                    Page 13 of 58<PAGE>
<PAGE>
<TABLE>
<CAPTION>
                                                          December 31,              December 30,  December 28,
                                               ----------------------------------   ------------  ------------
                                                 1992        1993        1994(1)       1995(2)        1996
<S>                                            <C>          <C>         <C>          <C>            <C>
BALANCE SHEET DATA:
Working Capital                                $18,332     $ 6,954      $ 8,430      $14,556        $13,802
Total Assets                                    53,921      66,172       78,293       81,237         74,264
Long-Term Debt and Capital Lease 
   Obligations                                   1,725      15,135       30,479       38,000         26,500
Shareholders' Equity                            42,665      31,577       29,613       26,326         29,906
Long-Term Debt and Lease Obligations
   as a Percentage of Shareholders'
   Equity                                           4%         48%         103%         144%            89%

</TABLE>


(1)      Financial information for 1994 includes results of international 
         operations for the 11 months ended November 30, 1994.  See Note 2 to
         consolidated financial statements.

(2)      Financial information for 1995 includes results of international 
         operations for the 12 months ended November 30, 1995.  See Note 2 
         to consolidated financial statements.

(3)      In 1995, the Company decided to dispose of its non-core business 
         operations, resulting in a $2 million provision.  See Note 13 to
         consolidated financial statements.

(4)      Effective January 1, 1992, the Company elected to convert from an 
         S Corporation to a C Corporation for income tax reporting purposes.  

(5)      Net income (loss) per common share is computed based on the weighted 
         average number of common stock and stock equivalent shares outstanding 
         during the period.  Except when antidilutive, options for the purchase 
         of common shares have been included as if exercised as of the date of
         grant, using the treasury stock method.

(6)      Calculated from sales from each month during the period divided by 
         the number of store weeks of sales during the period, excluding 
         stores not open a full month.


                                    Page 14 of 58<PAGE>
<PAGE>
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
         RESULTS OF OPERATIONS 

Results of Operations
---------------------

     The Company's results of operations in any period are significantly 
affected by the number of vision centers opened and operating during such 
period.  Given the Company's rapid expansion to 341 vision centers at 
December 28, 1996, and dispositions of significant operating units (both 
domestic and foreign), period-to-period comparisons may not be meaningful 
and the results of operations for historical periods may not be indicative 
of future results.  Results for 1995 included nonrecurring charges 
approximating $2 million.  (See Note 13 to consolidated financial statements.)

     Effective January 1, 1995, the Company changed its year end to a more 
standard 52/53 week retail calendar with the fiscal year ending on the 
Saturday closest to December 31.  International operations were reported 
using a fiscal year ended November 30.  As a result of these changes, 1994 
consolidated results include the results of international operations for the 
11 months ended November 30, 1994.  The effect of this change was not 
material.  (See Note 2 to consolidated financial statements.)

Year Ended December 28, 1996 Compared to Year Ended December 30, 1995
---------------------------------------------------------------------

Consolidated Results in Fiscal 1996
-----------------------------------

     NET SALES.  1996 net sales increased to $160.4 million from $145.6 
million for 1995, due to the net effect of the following: (a) an increase
in the number of domestic vision centers; (b) a 4% increase in comparable
sales for domestic vision centers (those open for at least one year); and
(c) a reduction in revenues resulting from the disposition and closure 
of businesses in the fourth quarter 1995 and the first quarter 1996.  
Consolidated average weekly net sales per vision center increased from 
approximately $8,700 in 1995 to $9,300 in 1996 due primarily to the 
disposition of underperforming vision centers in the Venture and Mexican 
operations.  The improvement in average weekly net sales for comparable 
domestic stores was partially offset by a reduction in average weekly net 
sales for vision centers opened in 1996.


                                    Page 15 of 58<PAGE>
<PAGE>
     In the first quarter 1996, the Company implemented a new merchandising 
program for spectacles.  Initially, the new program served to increase the 
average number of sales transactions per vision center (market share) 
over the prior year, but at a lower dollar value per transaction.  The 
Company experienced an increase in average number of transactions per 
vision center for the remainder of the year.  In the latter part of 1996, 
the average transaction value increased.  For the year, the improvement 
in sales resulting from market share increases more than offset the effect 
on sales resulting from the decline in the average transaction value.  The 
Company expects this positive trend to continue.

     Consistent with the trend experienced in 1994 and 1995, average 
weekly sales volumes for new domestic vision centers opened in 1996 were
lower than vision centers opened in the previous year.  The effect of 
lower new store results in 1996, which had a negative impact on consolidated
average weekly sales, was offset by an increase in average weekly sales
for stores opened in 1995 and 1994.  

     GROSS PROFIT.  Gross profit in 1996 increased to $83.7 million from
$77.6 million in 1995, primarily because of increased net sales.  Gross 
profit as a percentage of sales declined from 53.3% in 1995 to 52.2% in 
1996.  The Company maintained margins from product sales at store level,
but margins were negatively affected by a reduction in promotional
monies from vendors (because of fewer store openings) and increased
freight costs related to store inventory resets.  Management expects the 
gross profit percentage to be positively affected in 1997 as a result 
of the transaction with Eyecare Leasing, Inc. and Stewart-Phillips, Inc., 
which closed in early January 1997.  (See Note 15 to consolidated 
financial statements.)

     SELLING, GENERAL, AND ADMINISTRATIVE ("SG&A") EXPENSES.  SG&A expenses
(which include both vision center operating expenses and home office
overhead) increased to $77 million in 1996 from $74.4 million in 1995,
reflecting the addition of new vision centers in 1996.  Average weekly
store expense per vision center remained constant.  As a percentage of
sales, SG&A expenses decreased from 51% in 1995 to 48% in 1996.  The
decrease was attributable to comparable store sales increases achieved
during 1996 and to continued improved efficiencies in the operation of 
administrative offices.

     OTHER INCOME (EXPENSE).  Other expense decreased from $2.6 million
in 1995 to $2.1 million in 1996 due to a decrease in average borrowings 
by the Company under its credit facility, in addition to a reduction in 
the effective interest rate paid by the Company in 1996 versus 1995.  
Management expects interest expense to increase in 1997 as a result of the 
transaction with Eyecare Leasing, Inc. and Stewart-Phillips, Inc., which 
closed in early January 1997.  (See Note 15 to consolidated financial 
statements.)


                                    Page 16 of 58<PAGE>
<PAGE>
     PROVISION FOR INCOME TAXES.  The effective income tax rate in 1996
is 26%.  In light of the sale of the unprofitable Venture domestic operations 
in the first quarter of 1996, the Company reassessed the realizability of 
domestic net operating loss carryforwards and accordingly reduced the 
valuation allowance in 1996.  Given current circumstances, the Company does 
not expect to further reduce the allowance in 1997; consequently, the 
effective income tax rate in 1997 is expected to be between 38% and 40%.

     NET INCOME.  In 1996, the Company achieved net income of $3.5 million,
or $0.17 per share, as compared to a net loss of $1.5 million, or $0.07
per share in 1995.  Results of operations for 1995 included charges 
approximating $2 million.  (See Note 13 to consolidated financial 
statements.)

International Results in Fiscal 1996
------------------------------------

     At November 30, 1996, the Company operated 21 vision centers 
internationally versus 36 vision centers at November 30, 1995.  International
locations included 18 in Mexico and two and one in the Czech Republic
and Slovakia, respectively.  Financial results for international operations
during 1996 are based on the 12 months ended November 30 (see Note 2 to
consolidated financial statements).

     NET INTERNATIONAL SALES.  Net international sales for the 12 months 
ended November 30, 1996 were $3.8 million, a decrease from $8.9 million 
during the 12 months ended November 30, 1995.  Such decrease was principally
due to closure of vision centers in France and in Mexico.

     GROSS PROFIT.  Gross profit decreased to $1.6 million from $4.4 million
in 1995, primarily the result of the decreased sales.  Gross profit as a 
percentage of sales declined from 49% in 1995 to 43% in 1996, due primarily 
to the effect of selling the French operation, which realized a higher gross 
profit percentage than the average for the international business.

     SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES EXCLUDING INTERCOMPANY
ALLOCATIONS.  SG&A expense decreased from $5.8 million for the 12 months
ended 1995 to $2.0 million for the 12 months ended November 30, 1996, as
a result of the dispositions mentioned above.  SG&A expense as a percentage
of sales decreased to 53% for the 12 months ended November 30,
1996 from 65% of sales for the 12 months ended November 30, 1995.  Reductions
in selected expenses at store level coupled with favorable leveraging of 
administrative expense reduced SG&A expense as a percentage of sales.

     OPERATING LOSS.  The operating loss for international operations does not
include allocated corporate overhead, interest or taxes.  International 
operations generated a net operating loss of $612,000 in the 12 months ended
November 30, 1996, as opposed to net operating loss of $1.3 million in the 
12 months ended November 30, 1995.  Mexican operations generated an operating
loss of $294,000 in the 12 months ended November 30, 1996.



                                    Page 17 of 58<PAGE>
<PAGE>
Year Ended December 30, 1995 Compared to Year Ended December 31, 1994
---------------------------------------------------------------------

     GENERAL.  The Company posted a net loss of $0.07 per share in 1995 on 
sales of $145.6 million compared to net income of $0.02 per share in 1994 on 
sales of $119.4 million.  Results for 1995 included provisions aggregating 
$2.0 million for disposition of assets and nonrecurring charges related to 
the Company's operations in Venture stores, Eastern Europe, and closure of 
ten locations in Mexico, along with a write-down of certain assets obtained 
in foreclosure proceedings.  (See Note 13 to consolidated financial 
statements.)  Excluding such provisions, 1995 operating income was $3.2 
million, an increase of 100% from operating income of $1.6 million in 1994.  
Operations in Venture vision centers and vision centers in France generated 
approximately $2.6 million in operating losses in 1995, exclusive of 
provisions for disposition of these operations. 


Consolidated Results in Fiscal 1995
-----------------------------------

     NET SALES.  1995 net sales increased to $145.6 million from $119.4 
million for calendar 1994, primarily because of the increase in the number 
of vision centers from 298 as of December 31, 1994 to 355 at December 30, 
1995.  Excluding Venture vision centers, comparable sales for domestic 
vision centers (those open for at least one year) were down 0.5% for 1995.  
Consolidated average weekly net sales per vision center decreased from 
$9,500 to $8,700 because of lower sales in new vision centers and in Venture 
and Mexico vision centers.  In 1994 and particularly in 1995, new domestic 
vision centers (excluding those in Venture stores) had sales volumes 
significantly lower than vision centers opened in the previous year.  

     GROSS PROFIT.  Gross profit in 1995 increased to $77.6 million from 
$65.5 million in 1994, primarily because of increased net sales.  
Efficiencies were achieved in laboratory operations and merchandising; 
however, the value of such efficiencies was more than offset by increased 
license fees payable to Wal-Mart.  Gross profit percentage accordingly 
decreased from 55% in 1994 to 53% in 1995.   

     SELLING, GENERAL, AND ADMINISTRATIVE ("SG&A") EXPENSES.  SG&A expenses 
(which include both vision center operating expenses and home office overhead) 
increased to $74.4 million in 1995 from $63.9 million in 1994, reflecting 
additional vision centers in 1995.  Average weekly store expense per vision 
center remained constant.  As a percentage of sales, SG&A expenses decreased 
to 51% in 1995 from 54% in 1994 because of favorable leveraging of home 
office and vision center overhead resulting from increased sales and improved 
systems.


                                    Page 18 of 58<PAGE>
<PAGE>
     OTHER INCOME (EXPENSE).  Other expense increased from $1.2 million in 
1994 to $2.6 million in 1995, due to an increase in interest expense.  As a 
result of the Company's increased borrowings in 1995, coupled with an 
increase in rates, interest expense on the Company's credit revolver 
increased to $3.0 million in 1995 from $1.4 million in 1994.

     NET LOSS.  In 1995, the Company incurred a net loss of $1.5 million, 
or $0.07 per share, as compared to net income of $351,000, or $0.02 per 
share, in 1994.  

International Results in Fiscal 1995
------------------------------------

     At November 30, 1995, the Company operated 36 vision centers 
internationally versus 37 vision centers at November 30, 1994.  
International locations included 23 in Mexico, ten in France, two and one 
in the Czech Republic and Slovakia, respectively, at November 30, 1995.  
Financial results for international operations during 1995 and 1994 are 
based on the 12 months and 11 months respectively ended November 30 
(see Note 2 to consolidated financial statements).  

     NET INTERNATIONAL SALES.  Net international sales for the 12 months 
ended November 30, 1995 were $8.9 million, an increase from $7.3 million 
during the 11 months ended November 30, 1994.  Such increase was principally 
due to the increased number of foreign vision centers.  Average weekly 
sales were $5,100 in 1995 versus $4,900 in 1994.  

     GROSS PROFIT.  Gross profit increased to $4.4 million from $3.4 million 
in 1994, primarily the result of increased sales.  Gross profit percentage 
was 49% for 1995 versus 47% for 1994 due for the most part to improved gross 
margin percentage in France and Eastern Europe offset by reduced gross 
margin percentage in Mexico.

     SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES EXCLUDING INTERCOMPANY 
ALLOCATIONS.  SG&A expense was $5.8 million or 65% of sales for the 12 
months ended November 30, 1995, an increase from $5.9 million or 80% of 
sales for the 11 months ended November 30, 1994.  Increased sales and 
favorable leveraging of home office expense reduced SG&A expense as a 
percentage of sales.  

     OPERATING LOSS.  The operating loss for international operations does 
not include allocated corporate overhead, interest or taxes.  International 
operations generated a net operating loss of $1.3 million (inclusive of a 
net gain of $145,000 relating to the sale of the Company's French 
operations offset by closure of ten locations in Mexico) in the 12 months 
ended November 30, 1995 as opposed to an operating loss of $2.5 million 
in 1994.  The Mexican operations generated an operating loss of $1.3 million 
(inclusive of a charge of $346,000 relating to the closure of ten locations) 
in the 12 months ended November 30, 1995 versus an operating loss of $1.3 
million during the 11-month period ended November 30, 1994.

 
                                    Page 19 of 58<PAGE>
<PAGE>
Inflation
---------

     Although the Company cannot determine the precise effects of inflation, 
it does not believe inflation has had a material effect on its domestic 
sales or results of operations.  The Company cannot determine whether 
inflation will have a material long-term effect on its sales or results of 
operations.  The currency devaluation in Mexico, which began in late 1994, 
has increased inflation and thereby may cause consumers to reduce 
discretionary purchases such as eyeglasses.

     The Securities and Exchange Commission has qualified Mexico as a highly 
inflationary economy under the provisions of SFAS No. 52 -  Foreign Currency 
Translation.  Consequently, in 1997, the financial statements of the Mexico 
operation will be remeasured with the U.S. dollar as the functional currency. 
Any gain or loss resulting from changes in foreign currency rates between 
the peso and the U.S. dollar, as calculated in the remeasurement process, 
will be recorded in the Company's statement of operations.  The Company 
is exploring options to reduce this financial risk.

Liquidity and Capital Resources
-------------------------------

     In 1994, the Company entered into a three-year $45 million revolving 
credit facility syndicated by a major regional bank.  The Company's credit 
facility contains, among other covenants, a material adverse change clause, 
certain minimum net worth requirements, as well as a covenant which limits 
the ability of the Company to expand outside of its domestic Wal-Mart vision 
centers.  In December of 1996, the facility was extended until May 1998.

     As of December 28, 1996, the Company had borrowed $26.5 million under
its credit facility versus outstanding borrowings of $38 million as of 
December 31, 1996.

     During 1996, store openings and other capital requirements were funded 
through internal cash flow.  Proceeds from the sale of the French business 
and current year earnings were the primary factors increasing cash flow 
during 1996, which allowed the Company to reduce outstanding borrowings.

     In connection with a transaction which closed in January 1997, the 
Company incurred long-term debt of approximately $4.1 million.  (See 
Note 15 to consolidated financial statements.)  This debt is being ratably
amortized over a twelve-year period.

     In December of 1994, the Company paid $173,000 in connection with an 
agreement to cap certain interest rates under its credit facility up to 
$15 million.  The agreement caps LIBOR at 7.5% per annum unless 
the LIBOR rate is above 9% per annum in which case the protected rate 
is 9% per annum.  The cap agreement expires February 1997.  In 1995, 
the Company entered into a two-year interest rate swap agreement (with a 
term expiring on February 20, 1998) which effectively converts underlying 
variable rate debt based on LIBOR to fixed rate debt.  The notional 
principal amount is $20 million, with an effective fixed rate of 7.305%.
  

                                    Page 20 of 58<PAGE>
<PAGE>
     As of February 3, 1997, the Company plans to open approximately 40 
domestic and approximately 6 Mexican vision centers during the remainder 
of 1997.  Average costs for domestic vision centers have approximated 
$145,000 for fixed assets, $35,000 for inventory, and $20,000 for pre-opening 
expenses.  Capital for leasehold improvements and start-up costs in Mexican 
vision centers should approximate $31,000 per vision center.  

     At February 1, 1997, the Company had borrowed $25.5 million under its 
credit facility, as amended.  In 1997, the Company expects to fund expansion 
from internal cash flow and to further reduce borrowings under its credit
facility.  The Company anticipates that internally generated funds, as well 
as funds available under the Company's revolving credit facility, will be 
sufficient to fund the ongoing operating costs associated with its current 
vision centers and vision centers scheduled to be opened during 1997 and 1998.  

Risk Factors
------------

     Any expectations, beliefs, and other non-historical statements contained 
in this 10-K are forward looking statements within the meaning of the Private 
Securities Litigation Reform Act of 1995 (the "Act").  Actual results may 
differ materially due to a variety of factors that affect the Company.  Such 
factors are described in a cautionary statement for purposes of the "Safe 
Harbor" provisions of the Act, contained in the Company's Current Report on 
Form 8-K filed with the Securities and Exchange Commission on January 17, 
1997.

Recent Accounting Pronouncements
--------------------------------

     Effective in 1996, the Company adopted Statement of Financial Accounting
Standards No. 121 ("FAS 121") "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to be Disposed Of" which establishes 
standards for determining when impairment losses on long-lived assets have 
occurred and how impairment losses should be measured.  The financial 
statement impact of adopting FAS 121 is not material.

     Effective in 1996, the Company adopted the disclosure option of 
Statement of Financial Accounting Standards No. 123 ("FAS 123") "Accounting
for Stock-Based Compensation."  FAS 123 requires that companies which
do not choose to account for stock-based compensation as prescribed by
the statement, shall disclose the pro forma effects on earnings and 
earnings per share as if FAS 123 had been adopted.  Additionally, 
certain other disclosures are required with respect to stock compensation
and the assumptions used to determine the pro forma effects of FAS 123.  
See Note 5 of Notes to Consolidated Financial Statements for the FAS 123
disclosures, as described.

ITEM  8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The Consolidated Financial Statements of the Company are included as a 
separate section of this Report commencing on page 30.

ITEM  9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

     There have been no disagreements with accountants on accounting and 
financial disclosure.

                                    Page 21 of 58<PAGE>
<PAGE>


                                  PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The section entitled "Election of Directors" contained in the definitive 
proxy statement to holders of the Company's Common Stock in connection with 
the solicitation of proxies to be used in voting at the 1997 Annual Meeting 
of Shareholders is hereby incorporated by reference for the purpose of 
providing information about the identification of directors.

ITEM 11.  EXECUTIVE COMPENSATION

     The section entitled "Compensation of Executive Officers" contained in 
the definitive proxy statement to holders of the Company's Common Stock in 
connection with the solicitation of proxies to be used in voting at the 
1997 Annual Meeting of Shareholders is hereby incorporated by reference 
for the purpose of providing information about executive compensation.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The section entitled "Common Stock Ownership of Certain Beneficial 
Owners and Management" contained in the definitive proxy statement to 
holders of the Company's Common Stock in connection with the solicitation 
of proxies to be used in voting at the 1997 Annual Meeting of Shareholders 
is hereby incorporated by reference for the purpose of providing information 
about security ownership of certain beneficial owners and management.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The section entitled "Compensation Committee Interlocks and Insider 
Participation" contained in the definitive proxy statement to holders of 
the Company's Common Stock in connection with the solicitation of proxies 
to be used in voting at the 1997 Annual Meeting of Shareholders is hereby 
incorporated by reference for the purpose of providing information about 
transactions with management and others and certain business relationships.



                                    Page 22 of 58<PAGE>
<PAGE>

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

     (a) (1) and (2)  The Consolidated Financial Statements and Schedule of 
the Company and its subsidiaries are filed herewith as a separate section 
of this Report commencing on page 30.

     (3)  The following exhibits are filed herewith or incorporated by 
reference:

Exhibit
Number 

 3.1a      --        Amended and Restated Articles of Incorporation of the 
                     Company. 

 3.2a      --        Amended and Restated By-Laws of the Company. 

 4.1n      --        Form of Common Stock Certificate.

 4.2o      --        Amended and Restated Articles of Incorporation of the
                     Company.

 4.5n      --        Rights Agreement dated as of January 17, 1997 between 
                     the Company and Wachovia Bank of North Carolina, N.A.

10.7a      --        Sublease Agreement, dated December 16, 1991, by and 
                     between Wal-Mart Stores, Inc. and the Company. 

10.10a++   --        Employment Agreement of Edward G. Weiner, dated as of 
                     March 2, 1992. 

10.15b++   --        Non-Employee Director Stock Option Plan, dated as of 
                     July 13, 1992. 

10.17c     --        Form indemnification agreement for directors and 
                     executive officers of the Company (attached to form 
                     agreement is schedule identifying dates and signatories 
                     to such agreements). 

                                    Page 23 of 58<PAGE>
<PAGE>

Exhibit
Number 

10.24d++   --        Employment Agreement of Sandra M. Buffa, dated as of 
                     June 15, 1993.

10.34e     --        Vision Center Master License Agreement, dated as of 
                     June 16, 1994, by and between Wal-Mart Stores, Inc. and 
                     the Company.  [Portions of Exhibit 10.34 have been 
                     omitted pursuant to an order for confidential treatment 
                     granted by the Commission.  The omitted portions have 
                     been filed separately with the Commission.]

10.36f     --        $45,000,000 Revolving Credit Facility, dated as of 
                     November 15, 1994, among the Company, Wachovia Bank of 
                     Georgia, N.A., Trust Company Bank, and Bank South, N.A.

10.36.1f   --        First Amendment to Credit Agreement, dated as of 
                     February 22, 1995, among the Company, Wachovia Bank of 
                     Georgia, N.A., Trust Company Bank, and Bank South, N.A.

10.36.2g   --        Second Amendment to Credit Agreement, dated as of 
                     October 4, 1995, among the Company, Wachovia Bank of 
                     Georgia, N.A., Trust Company Bank, and Bank South, N.A.

10.36.3g   --        Third Amendment to Credit Agreement, dated as of 
                     November 3, 1995, among the Company, Wachovia Bank of 
                     Georgia, N.A., SunTrust Bank Atlanta (formerly Trust 
                     Company Bank), and Bank South, N.A.

10.36.4h   --        Fourth Amendment to Credit Agreement, dated as of 
                     February 15, 1996, among the Company, Wachovia Bank of 
                     Georgia, N.A., SunTrust Bank, Atlanta (formerly Trust 
                     Company Bank), and Nationsbank, N.A. (South) (formerly 
                     known as Bank South, N.A.).

10.36.5**  --        Fifth Amendment to Credit Agreement, dated as of 
                     December 12, 1996, among the Company, Wachovia Bank of
                     Georgia, N.A., SunTrust Bank, Atlanta, and NationsBank, 
                     N.A.



                                    Page 24 of 58<PAGE>
<PAGE>

Exhibit
Number 

10.37f++   --        Split Dollar Life Insurance Agreement, dated as of 
                     November 3, 1994, among the Company, A. Kimbrough Davis, 
                     as Trustee, and James W. Krause.

10.39f++   --        NVAL 1995 Level IV Management Incentive Plan

10.40f++   --        Letter Agreement between the Company and D. Michael 
                     Lampman, dated as of October 19, 1993.

10.41i++   --        Letter Agreement between the Company and Edward G. 
                     Weiner, dated as of May 16, 1995.

10.42j     --        Purchase Agreement dated as of December 12, 1995 by and 
                     between International Vision Associates, Ltd. and 
                     Carrefour France (includes (a) list identifying omitted 
                     schedules and (b) agreement to furnish supplementally a 
                     copy of any omitted schedule to the Commission upon 
                     request).

10.43j     --        Agreement for the Purchase and Sale of Assets dated as of 
                     September 1, 1995 by and among National Vision 
                     Associates, Ltd., Optical Ventures, Inc. and Uhlemann 
                     Optical Company (includes (a) list identifying omitted 
                     schedules and (b) agreement to furnish supplementally 
                     a copy of any omitted schedule to the Commission upon 
                     request).

10.44j     --        Agreement for the Purchase and Sale of Assets dated as of 
                     December 26, 1995 by and between National Vision
                     Associates, Ltd. and Budget Opticals of America, Inc. 
                     (includes (a) list identifying omitted schedules and 
                     (b) agreement to furnish supplementally a copy of any 
                     omitted schedule to the Commission upon request).

10.45j     --        Agreement for the Purchase and Sale of Assets dated 
                     as of January 10, 1996 by and between National Vision
                     Associates, Ltd. and Comprehensive Eyecare, Ltd. 
                     (includes (a) list identifying omitted schedules and 
                     (b) agreement to furnish supplementally a copy of any 
                     omitted schedule to the Commission upon request).


                                    Page 25 of 58<PAGE>
<PAGE>

Exhibit
Number 


10.46h     --        Agreement dated as of November 23, 1995 by and between 
                     Mexican Vision Associates Operadora, S. de R.L. de C.V. 
                     and Wal-Mart de Mexico, S.A. de C.V. in original Spanish 
                     and an uncertified English translation.  [Portions of 
                     Exhibit 10.46 have been omitted pursuant to a request 
                     for confidential treatment filed with the Commission.  
                     The omitted portions have been filed separately with 
                     the Commission.]

10.47k++   --        Executive Relocation Policy

10.48l++   --        Restated Stock Option and Incentive Award Plan

10.49**++  --        Change in Control Agreement, dated November 6, 1996, 
                     between the Company and the executive officers listed
                     on the attached schedule.

10.50**    --        Agreement for Assignment of License Interests and Related
                     Matters dated as of November 1, 1996 by and among the 
                     Company and other parties (includes (a) list identifying
                     omitted schedules and (b) agreement to furnish 
                     supplementally a copy of any omitted schedule to the 
                     Commission upon request).

11**       --        Statement Re: Computation of Net Income (Loss) Per Share.

21**       --        Subsidiaries of the Registrant

23**       --        Consent by Arthur Andersen LLP

27**       --        Financial Data Schedule

99.1o      --        Press Release dated January 17, 1997.

a         Incorporated by reference to the Company's Registration Statement 
          on Form S-1, registration number 33-46645, filed with the Commission
          on March 25, 1992, and amendments thereto.

b        Incorporated by reference to the Company's Registration Statement on 
         Form S-1, registration number 33-52766, filed with the Commission
         on October 2, 1992, and amendments thereto.

c        Incorporated by reference to the Company's Form 10-K for the fiscal 
         year ended December 31, 1992.


                                    Page 26 of 58<PAGE>
<PAGE>

Exhibit
Number 

d        Incorporated by reference to the Company's Form 10-Q for the 
         quarterly period ended September 30, 1993.

e        Incorporated by reference to the Company's Form 10-Q for the 
         quarterly period ended September 30, 1994.

f        Incorporated by reference to the Company's Form 10-K for the 
         fiscal year ended December 31, 1994.

g        Incorporated by reference to the Company's Form 10-Q for the 
         quarterly period ended September 30, 1995.

h        Incorporated by reference to the Company's Form 10-K for the 
         fiscal year ended December 30, 1995.

i        Incorporated by reference to the Company's Form 10-Q for the 
         quarterly period ended July 1, 1995.

j        Incorporated by reference to the Company's Form 8-K filed on 
         January 16, 1996.

k        Incorporated by reference to the Company's Form 10-Q for the
         quarterly period ended March 30, 1996.

l        Incorporated by reference to the Company's Form 10-Q for the
         quarterly period ended June 29, 1996.

m        Incorporated by reference to the Company's Registration Statement
         on Form 8-A filed with the Commission on January 17, 1997.

n        Incorporated by reference to the Company's Registration Statement
         on Form 8-A (there designated as Exhibit 10.1) filed with the
         Commission on January 17, 1997.

o        Incorporated by reference to the Company's Form 8-K filed with the 
         Commission on January 17, 1997.

**       Filed with this Form 10-K.


                                    Page 27 of 58<PAGE>
<PAGE>

Exhibit
Number 

++       Management contract or compensatory plan or arrangement in which 
         a director or named executive officer participates.


         (b)  No reports on Form 8-K have been filed during October, 
              November, or December, 1996.





















                                    Page 28 of 58<PAGE>
<PAGE>
                                SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities 
Exchange Act of 1934, the registrant has duly caused this report to be 
signed on its behalf by the undersigned, thereunto duly authorized.

                                      NATIONAL VISION ASSOCIATES, LTD.


                                      By:      /s/James W. Krause
                                               James W. Krause
                                               Chairman of the Board, 
                                               President and Chief Executive 
                                               Officer and Director
Date: February 12, 1997

     Pursuant to the requirements of the Securities Exchange Act of 1934, 
this report has been signed below by the following persons on behalf of the 
registrant on February 12, 1997, in the capacities indicated.

    Signature                                      Title

    /s/
_____________________________                                                  
    James W. Krause                   Chairman of the Board, President
                                      and Chief Executive Officer and Director

    /s/
_____________________________
    Sandra M. Buffa                   Senior Vice President, Finance and 
                                      Treasurer, and Director (Principal 
                                      Financial Officer)
  
    /s/
_____________________________
    Angus C. Morrison                 Vice President, Corporate Controller 
                                      (Principal Accounting Officer)

    /s/
_____________________________
    David I. Fuente                   Director

    /s/
_____________________________
    Ronald J. Green                   Director

    /s/
_____________________________
    Campbell B. Lanier, III           Director

    /s/
_____________________________
    J. Smith Lanier, II               Director


                                    Page 29 of 58<PAGE>
<PAGE>




                 NATIONAL VISION ASSOCIATES, LTD. AND SUBSIDIARIES


                  CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE
         AS OF DECEMBER 31, 1994, DECEMBER 30, 1995 AND DECEMBER 28, 1996
                                   TOGETHER WITH
                                  AUDITORS' REPORT























                                    Page 30 of 58<PAGE>
<PAGE>

                  NATIONAL VISION ASSOCIATES, LTD. AND SUBSIDIARIES
                      INDEX TO FINANCIAL STATEMENTS AND SCHEDULE

     The following consolidated financial statements and schedule of the 
Registrant and its subsidiaries are submitted herewith in response to 
Item 8 and Item 14(a)1 and to Item 14(a)2, respectively.

                                                                         Page
                                                                         ____

Report of Independent Public Accountants                                  32

Consolidated Balance Sheets as of December 30, 1995 and
  December 28, 1996                                                       33 

Consolidated Statements of Operations for the 
  Years Ended December 31, 1994, December 30, 1995 and
  December 28, 1996                                                       34 

Consolidated Statements of Shareholders' Equity for 
  the Years Ended December 31, 1994, December 30, 1995 and
  December 28, 1996                                                       35 

Consolidated Statements of Cash Flows for the Years Ended 
  December 31, 1994, December 30, 1995 and December 28, 1996              36 

Notes to Consolidated Financial Statements and Schedule                   37 

Schedule II, Valuation and Qualifying Accounts                            58 



     All other schedules for which provision is made in the applicable 
accounting regulations of the Securities and Exchange Commission are not 
required under the related instructions, are inapplicable, or have been 
disclosed in the notes to consolidated financial statements and, 
therefore, have been omitted.


                                    Page 31 of 58<PAGE>
<PAGE>

                      REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Shareholders of National Vision
Associates, Ltd. and Subsidiaries:


     We have audited the accompanying consolidated balance sheets of 
NATIONAL VISION ASSOCIATES, LTD. (a Georgia corporation) AND SUBSIDIARIES 
as of December 30, 1995 and December 28, 1996 and the related consolidated 
statements of operations, shareholders' equity, and cash flows for the 
years ended December 31, 1994, December 30, 1995 and December 28, 1996.  
These financial statements and the schedule referred to below are the 
responsibility of the Company's management.  Our responsibility is to 
express an opinion on these financial statements and schedule based on our 
audits.

     We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to 
obtain reasonable assurance about whether the financial statements are free 
of material misstatement.  An audit includes examining, on a test basis, 
evidence supporting the amounts and disclosures in the financial statements. 
An audit also includes assessing the accounting principles used and 
significant estimates made by management, as well as evaluating the 
overall financial statement presentation.  We believe that our audits 
provide a reasonable basis for our opinion. 

     In our opinion, the financial statements referred to above present 
fairly, in all material respects, the financial position of National 
Vision Associates, Ltd. and subsidiaries as of December 30, 1995 and 
December 28, 1996 and the results of their operations and their cash 
flows for the years ended December 31, 1994, December 30, 1995 and 
December 28, 1996 in conformity with generally accepted accounting 
principles.

     Our audits were made for the purpose of forming an opinion on the 
basic financial statements taken as a whole.  The schedule listed in the 
index to consolidated financial statements is presented for purposes of 
complying with the Securities and Exchange Commission's rules and is 
not part of the basic financial statements.  This schedule has been 
subjected to the auditing procedures applied in the audit of the basic 
financial statements and, in our opinion, fairly states in all material 
respects the financial data required to be set forth therein in relation 
to the basic financial statements taken as a whole.



                                         ARTHUR ANDERSEN LLP

Atlanta, Georgia
February 10, 1997


                                    Page 32 of 58<PAGE>
<PAGE>
<TABLE>
<CAPTION>
                NATIONAL VISION ASSOCIATES, LTD. AND SUBSIDIARIES

                            CONSOLIDATED BALANCE SHEETS
                      December 30, 1995 and December 28, 1996
                          (000's except share information)
                                                                                                           1995           1996 
                                                                                                           ____           ____
                                        ASSETS
<S>                                                                                                     <C>            <C>
CURRENT ASSETS:
 Cash and cash equivalents                                                                               $ 1,307        $ 1,110
 Accounts receivable (net of allowance: 1995 - $339; 1996 - $353)                                          2,674          4,164
 Receivable from sale of French operations                                                                 3,774               
 Inventories                                                                                              21,376         23,970
 Store preopening costs (net of accumulated amortization: 1995 - $755; 1996 - $605)                          880            240
 Assets held for sale                                                                                        445               
 Other current assets                                                                                      1,011            944
                                                                                                         -------        -------
    Total current assets                                                                                  31,467         30,428
                                                                                                         -------        -------
PROPERTY AND EQUIPMENT:
 Equipment                                                                                                37,038         38,573
 Furniture and fixtures                                                                                   16,283         17,136
 Leasehold improvements                                                                                   12,615         13,178
 Construction in progress                                                                                  2,266          1,669
                                                                                                         -------        -------
                                                                                                          68,202         70,556
 Less accumulated depreciation                                                                           (19,155)       (27,206)
                                                                                                         -------        -------
 Net property and equipment                                                                               49,047         43,350
                                                                                                         -------        -------
ORGANIZATION COSTS (net of accumulated amortization: 1995 - $529; 1996 - $503)                               182            108
                                                                                                         -------        -------
OTHER ASSETS AND DEFERRED COSTS (net of accumulated amortization: 
  1995 - $190; 1996 - $226)                                                                                  541            378
                                                                                                         _______        _______
                                                                                                         $81,237        $74,264
                                                                                                         =======        =======

                                                             LIABILITIES AND SHAREHOLDERS' EQUITY 
CURRENT LIABILITIES:
 Accounts payable                                                                                        $ 8,537        $ 8,283
 Accrued expenses and other current liabilities                                                            7,894          8,343
 Current portion of long-term debt and capital lease obligations                                             158               
 Current portion of capital lease obligations due to related parties                                         322               
                                                                                                         -------        -------
     Total current liabilities                                                                            16,911         16,626
                                                                                                         -------        -------
LONG-TERM DEBT, less current portion                                                                      38,000         26,500
                                                                                                         -------        -------
 Deferred Income Tax Liabilities                                                                                          1,232
                                                                                                         -------        -------
COMMITMENTS AND CONTINGENCIES 
SHAREHOLDERS' EQUITY:
 Preferred stock, $1 par value; 5,000,000 shares authorized, none issued                                      --             -- 
 Common stock, $.01 par value; 100,000,000 shares authorized,  
   20,586,505 and 20,644,752 shares issued and outstanding as 
   of December 30, 1995 and December 28, 1996, respectively                                                  206            206
 Additional paid-in capital                                                                               42,147         42,166
 Retained deficit                                                                                        (11,873)        (8,393)
 Cumulative foreign currency exchange rate translation                                                    (4,154)        (4,073)
                                                                                                         -------        -------
     Total shareholders' equity                                                                           26,326         29,906
                                                                                                         -------        -------
                                                                                                         $81,237        $74,264
                                                                                                         =======        =======

</TABLE>

    The accompanying notes are an integral part of these consolidated 
    financial statements.

                                    Page 33 of 58<PAGE>
<PAGE>
<TABLE>
<CAPTION>
                          NATIONAL VISION ASSOCIATES, LTD. AND SUBSIDIARIES

                                CONSOLIDATED STATEMENTS OF OPERATIONS
            For the Years Ended December 31, 1994, December 30, 1995 and December 28, 1996
                                 (000's except per share information)

                                                                              1994              1995              1996
                                                                              ----               ----             ----
<S>                                                                        <C>                <C>               <C>
NET SALES                                                                  $119,395          $145,573           $160,376
COST OF GOODS SOLD                                                           53,898            67,966             76,692
                                                                           --------          --------           --------
GROSS PROFIT                                                                 65,497            77,607             83,684
SELLING, GENERAL, AND
  ADMINISTRATIVE EXPENSES                                                    63,911            74,390             76,920
PROVISION FOR DISPOSITION OF 
  ASSETS                                                                                          958 
OTHER NONRECURRING CHARGES                                                                      1,053 
                                                                           --------           --------          --------
OPERATING INCOME                                                              1,586             1,206              6,764
                                                                           --------           --------          --------
OTHER EXPENSE, NET                                                            1,195             2,626              2,084 
                                                                           --------           --------          --------
INCOME (LOSS) BEFORE INCOME TAXES                                               391            (1,420)             4,680
PROVISION FOR INCOME TAXES                                                       40               100              1,200 
                                                                           --------           --------          --------
NET INCOME (LOSS)                                                          $    351          $ (1,520)          $  3,480
                                                                           ========           ========          ========
NET INCOME (LOSS) PER COMMON SHARE                                         $    .02          $   (.07)          $    .17
                                                                           ========           ========          ========

</TABLE>

    The accompanying notes are an integral part of these consolidated 
    financial statements.


                                    Page 34 of 58<PAGE>
<PAGE>
<TABLE>
<CAPTION>
                       NATIONAL VISION ASSOCIATES, LTD. AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
        For the Years Ended December 31, 1994, December 30, 1995, and December 28, 1996
                                   (000's except share information)                        

                                                                       Additional       Retained        Cumulative
                                                    Common Stock         Paid-In        Earnings        Translation
                                                Shares        Amount     Capital        (Deficit)       Adjustments        Total
                                                ------        ------   ----------       ---------       -----------        -----

<S>                                           <C>               <C>      <C>            <C>                <C>           <C>
BALANCE, December 31, 1994                    20,510,402        $205     $42,133        $(10,353)          $(2,372)      $29,613 
Exercise of stock options                         76,103           1          14                                              15 
Foreign Currency Exchange Rate Translation                                                                  (1,782)       (1,782)
Net Loss                                                                                  (1,520)                         (1,520)
                                              ----------        ----     -------        --------           -------       -------
BALANCE, December 30, 1995                    20,586,505         206      42,147         (11,873)           (4,154)       26,326
Exercise of stock options                         58,247                      19                                              19
Foreign Currency Exchange Rate Translation                                                                      81            81
Net Income                                                                                 3,480                           3,480
                                              ----------        ----     -------        --------           -------       -------
BALANCE, December 28, 1996                    20,644,752        $206     $42,166        $ (8,393)          $(4,073)      $29,906
                                              ==========        ====     =======        ========           =======       =======
</TABLE>




     The accompanying notes are an integral part of these consolidated 
     financial statements.


                                    Page 35 of 58<PAGE>
<PAGE>
<TABLE>
<CAPTION>
                       NATIONAL VISION ASSOCIATES, LTD. AND SUBSIDIARIES
                              CONSOLIDATED STATEMENTS OF CASH FLOWS
          For the Years Ended December 31, 1994, December 30, 1995 and December 28, 1996
                                               (000's)
                                                                               1994               1995               1996
                                                                               ----               ----               ----
<S>                                                                          <C>                <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                                                            $    351           $ (1,520)          $  3,480
                                                                             --------            -------           --------
Adjustments to reconcile net income (loss) to 
  net cash provided by (used in) operating activities:     
    Provision for disposition of assets                                                              958  
    Provision for other nonrecurring charges                                                       1,053  
    Depreciation and amortization                                               7,567             10,378             10,054
    Provision for Deferred Income Tax Expense                                                                         1,002
    Changes in assets and liabilities:
      Receivables                                                                 408               (701)             2,224
      Inventories                                                              (1,388)            (2,467)            (2,594)
      Store preopening costs                                                   (1,657)            (1,288)              (657)
      Other current assets                                                        104                (34)                68
      Accounts payable, accrued expenses, and other 
       current liabilities                                                     (1,259)               (88)               200
                                                                             --------            -------           ---------
         Total adjustments                                                      3,775              7,811             10,297
                                                                             --------            -------           ---------
         Net cash provided by operating activities                              4,126              6,291             13,777
                                                                             --------            -------           ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment                                            (15,963)           (13,175)            (2,713)
Organization costs                                                                226                (18)              (190)
Change in other assets                                                         (1,017)                47                579
Change in other liabilities                                                                                             230
                                                                             --------            -------           ---------
         Net cash (used in) investing activities                              (16,754)           (13,146)            (2,094)
                                                                             --------           --------           ---------
CASH FLOWS FROM FINANCING ACTIVITIES:  
Net borrowings (repayment) on bank line of credit                              16,000              8,000            (11,500)
Net repayment on long-term debt and capital leases                               (659)              (471)              (480)
Net proceeds from issuance of common stock                                         57                 15                 19
                                                                             --------           --------           ---------
         Net cash provided by (used in) financing activities                   15,398              7,544            (11,961)
                                                                             --------           --------           ---------
Effect of foreign currency exchange rate changes                              (2,372)             (1,782)                81
                                                                             --------           --------           ---------
NET INCREASE (DECREASE) IN CASH                                                  398              (1,093)              (197)
CASH, beginning of year                                                        2,002               2,400              1,307
                                                                             --------           --------           ---------
CASH, end of year                                                            $  2,400           $  1,307           $  1,110
                                                                             ========           ========           =========
</TABLE>
    The accompanying notes are an integral part of these consolidated 
    financial statements.
                                    Page 36 of 58<PAGE>
<PAGE>
               NATIONAL VISION ASSOCIATES, LTD. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE
           December 31, 1994, December 30, 1995 and December 28, 1996

1.  ORGANIZATION AND OPERATIONS

     National Vision Associates, Ltd. (the "Company") is engaged in the 
retail sale of optical goods and services as a licensee operating within 
mass merchandise department stores.  The Company is largely dependent on 
Wal-Mart Stores, Inc. ("Wal-Mart") for continued operation of current 
vision centers and expansion with new vision centers (Note 3).  

2.  SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

     The consolidated financial statements include the accounts of the 
Company and its subsidiaries.  All significant intercompany balances and 
transactions have been eliminated in consolidation.  Effective 
January 1, 1995, the Company changed its year end to a 52/53 week retail 
calendar with the fiscal year ending on the Saturday closest to December 31. 
Pursuant to such calendar, financial information for each of 1995 and 1996 
is presented for the 52-week period ended December 30 and December 28,
respectively.  Financial information for 1994 is presented as previously 
reported for the year ended December 31.  Due to various statutory and 
other considerations, international operations were not changed to this 
52/53 week calendar.  To allow for more timely consolidation and reporting, 
international operations are reported beginning with fiscal 1994 using a 
fiscal year ending November 30.  As a result of these changes, consolidated 
results include the results of international operations for the 11, 12, 
and 12 months ended November 30, 1994, 1995, and 1996, respectively.  For 
December 1994, international operations reported a net loss of approximately 
$170,000.  Certain amounts in the December 31, 1994 and December 30, 1995 
consolidated financial statements have been reclassified to conform to the 
December 28, 1996 presentation.

Revenue Recognition

     The Company recognizes revenues and the related costs from retail 
sales when at least 50% of the payment has been received.

Cash and Cash Equivalents

     The Company considers cash on hand, short-term cash investments, and 
checks that have not been processed by financial institutions to be cash 
and cash equivalents.  The aggregate amount of outstanding checks not 
processed at December 28, 1996 was $440,000.  The Company's policy 
is to maintain uninvested cash at minimal levels.  Cash includes cash 
equivalents which represent highly liquid investments with a maturity of 
one month or less.  The carrying amount approximates fair value.  The 
Company restricts investment of temporary cash investments to financial 
institutions with high credit standing.  


                                    Page 37 of 58<PAGE>
<PAGE>
Inventories

     Inventories are valued at the lower of weighted average cost or 
market.  Market represents the net realizable value.

Store Preopening Costs

     Preopening costs which are directly associated with the opening of 
new vision centers are capitalized and amortized using the straight-line 
method over 12 months beginning with the commencement of each vision center's 
operations.  The average cost capitalized per vision center approximated 
$23,000.

Property and Equipment

     Property and equipment are stated at cost.  For financial reporting 
purposes, depreciation is computed using the straight-line method over 
the assets' estimated useful lives or terms of the related leases, 
whichever is shorter.  Accelerated depreciation methods are used for 
income tax reporting purposes.  For financial reporting purposes, the 
useful lives used for computation of depreciation range from five to ten 
years for equipment, from three to nine years for furniture and fixtures,
from three to six years for hardware and software related to information 
systems processing, and nine years for leasehold improvements.  At the 
time property and equipment are retired, the cost and related accumulated 
depreciation are removed from the accounts and any gain or loss is credited 
or charged to income.  Maintenance and repairs are charged to expense as 
incurred.  Replacements and improvements are capitalized.  Assets held 
for sale is comprised of property and equipment which are valued at the 
lower of carrying amount or net realizable value. 

Balance Sheet Financial Instruments:  Fair Values

     The carrying amount reported in the consolidated balance sheets for 
cash, accounts receivable, accounts payable and short-term debt approximates 
fair value because of the immediate or short-term maturity of these financial 
instruments.  The carrying amount reported for long-term debt approximates 
fair value because the underlying instrument is a variable rate note that 
reprices frequently.  The fair value of the Company's fixed interest rate 
hedge agreement is based on estimates using standard pricing models that take 
into consideration current interest rate market conditions supplied by 
independent financial institutions.

     Financial instruments which potentially subject the Company to 
concentrations of credit risk consist principally of trade accounts 
receivable.  The risk is limited due to the large number of individuals 
and entities comprising the Company's customer base and their dispersion 
across many different industries and geographies. 


                                    Page 38 of 58<PAGE>
<PAGE>
Income Taxes

     The Company accounts for income taxes as defined in Statement of 
Financial Accounting Standards No. 109 ("SFAS No. 109"), "Accounting for 
Income Taxes."  Deferred income taxes are recorded using enacted tax laws 
and rates for the years in which the taxes are expected to be paid.  Deferred 
income taxes are provided for depreciation, store preopening costs, 
organization costs, inventory basis differences, and accrued expenses where 
there is a temporary difference in recording such items for financial 
reporting and income tax reporting purposes.

Organization Costs

     Organization costs of the Company and subsidiaries have been 
capitalized and are being amortized on a straight-line basis over a 
five-year period.

Advertising and Promotion Expense

     The Company accounts for advertising costs in accordance with the 
American Institute of Certified Public Accountants Statement of Position 
No. 93-7 "Reporting on Advertising Costs."  Production costs of future 
media advertising and related promotion campaigns are deferred until 
the advertising events occur.  All other advertising and promotion 
costs are expensed when incurred.

Other Income and Expense

     Other income and expense represents net financing costs associated 
with the Company's financing activities, including interest costs on 
borrowings under the revolving credit facility, amortization of 
interest rate hedge and swap agreements, purchase discounts on invoice
payments, interest income on cash investments and realized exchange 
gains or losses resulting from foreign currency transactions.

Foreign Currency Translation

     The financial statements of foreign subsidiaries are translated 
into U.S. dollars in accordance with Statement of Financial Accounting 
Standards No. 52 ("SFAS No. 52").  Translation adjustments, which result 
from the process of translating foreign financial statements into U.S. 
dollars, are accumulated as a separate component of shareholders' equity. 

     The Securities and Exchange Commission has qualified Mexico as a highly 
inflationary economy under the provisions of SFAS No. 52 for reporting periods
starting in 1997.  In 1997, the financial statements of the Mexico operation 
will be remeasured with the U.S. dollar as the functional currency.  Any gain 
or loss will be recorded in the Company's statement of operations.  

Use of Estimates

     The preparation of financial statements in conformity with generally 
accepted accounting principles requires management to make estimates and 
assumptions that affect the reported amounts of assets and liabilities 
and disclosure of contingent assets and liabilities at the date of the 
financial statements and the reported amounts of revenues and expenses 
during the reporting period.  Actual results could differ from those 
estimates.
                                    Page 39 of 58<PAGE>
<PAGE>
3.  WAL-MART AND VENTURE MASTER LICENSE AGREEMENTS

     Wal-Mart Agreement

     In 1994, the Company and Wal-Mart replaced their original agreement with 
a new master license agreement (the "Wal-Mart Agreement"), which increased 
license fees payable by the Company and also granted the Company the 
opportunity to operate up to 400 vision centers (320 vision centers were 
in operation at year end 1996) in existing and future Wal-Mart stores.  In 
January 1995, the Company made a lump sum payment in exchange for such 
opportunity.  The payment is being amortized over the initial term of the 
vision centers opened subsequent to January 1, 1995.  Each vision center 
covered by the Wal-Mart Agreement has a separate license.  Pursuant to the
Wal-Mart Agreement, the term of each such license is nine years with a 
renewable option for one additional three-year term.

     Venture Agreement

     In 1993, the Company and Venture Stores, Inc. executed a master license
agreement which granted the Company a right of first refusal to open vision 
centers in all Venture stores.  In 1995, the Company decided to dispose of 
all of its operations in Venture stores and completed such dispositions 
in 1995 and early 1996. 
(See Note 13.)  


4.  FOREIGN AGREEMENTS

     Mexico Agreements

     Pursuant to an agreement with Almacenes Aurrera, S.A. de C.V., the 
Company owned and operated vision centers using the "Aurrera" name for 
nine-year terms in  certain of Aurrera's retail discount stores.  In 1995, 
the Company decided to close all of such vision centers, six of which 
were closed in 1995 and ten of which were closed in January and February 
1996.  (See Note 13.)  

     In 1994, the Company opened 8 vision centers in stores owned and 
operated by Wal-Mart de Mexico, S.A. de C.V.  In 1995, the Company 
completed the negotiation of a master license agreement governing these 
vision centers.  Pursuant to this agreement, each vision center has an 
individual base term of five years from the date of opening, followed 
by two options (each for two years), and one option for one year.  Each 
party has the right to terminate a location which fails to meet specified 
sales levels.  The agreement provides for annual fees based on a minimum 
and percentage of sales.  The agreement also gives the Company a right 
of first refusal to open vision centers in all stores in Mexico owned 
by Wal-Mart de Mexico.  As of December 28, 1996, the Company operated 
18 vision centers in Wal-Mart de Mexico stores.


                                    Page 40 of 58<PAGE>
<PAGE>
     Other Agreements

     In 1993, foreign subsidiaries of the Company executed license 
agreements with each of Carrefour, S.A. (in France) and Zellers Inc. (in 
Canada).  In 1995, the Company sold the operations in France.  (See Note 
13.)  In June 1994, the Company sold certain of its assets relative to 
the Canadian operation to a partnership in which the Company holds an 
18% interest.  In connection with the sale of its assets, the Company
received a promissory note, which was settled in 1996.  In conjunction 
with such settlement, the Company also agreed to transfer its 18% 
interest in the partnership.
 
     The Company owns 50% of a joint venture which owns and operates 
three vision centers located in Tesco, PLC stores in Eastern Europe.
Each vision center is located within a Tesco store and is subject to a 
separate agreement.  Each agreement provides for the payment of minimum 
and percentage rent.  In 1995, the Company announced its intention to 
sell its joint venture interest in these vision centers.  (See Note 13.)

5.  EQUITY TRANSACTIONS

Stock Option Plans

     In 1996, the Company adopted the Restated Stock Option and Incentive 
Award Plan (the "Plan") pursuant to which incentive stock options 
qualifying under Section 422A of the Internal Revenue Code and nonqualified 
stock options may be granted to key employees.  The Plan replaced and 
restated all the Company's prior key employee stock option plans.  A total 
of up to 3,350,000 shares of common stock may be granted under the Plan
(a total of up to 2,350,000 shares were available for grant under the 
prior plans).  The Plan is administered by the Compensation Committee of 
the Company's Board of Directors.  The Compensation Committee has the 
authority to determine the persons receiving options, option prices, dates 
of grants, and vesting periods, although no option may have a term exceeding 
ten years.  Options granted prior to 1996 have a term of five years.  At 
December 28, 1996, 1,830,166 options were outstanding at exercise prices 
ranging from $0.44 to $21.38.

Directors' Stock Option Plan

     In July 1992, the Company adopted the Non-Employee Director Stock 
Option Plan (the "Directors Plan"), pursuant to which stock options for 
up to 270,000 shares of Common Stock may be granted to nonemployee 
directors.  The Directors Plan provides for the grant of options to 
purchase 30,000 shares of the Company's Common Stock with an exercise 
price of $15.08 to each of the four nonemployee directors serving on the
date of adoption and automatic grants of additional options to purchase 
7,500 shares of the Company's common stock upon each anniversary of the 
Directors Plan to each nonemployee director serving on such date.  Of 
the options granted, 50% of the shares under each option are exercisable 
on the second anniversary of the grant date, 75% in three years, and 
100% in four years.  All option grants are at exercise prices no less 
than the market value of a share of Common Stock on the date of grant 
and are exercisable for a five-year period.  Options covering 157,500 
shares under the Directors Plan were exercisable at December 28, 1996.  


                                    Page 41 of 58<PAGE>
<PAGE>
All Stock Option Plans 

     All exercise prices represent the estimated fair value of the Common 
Stock on the date of grant as determined by the Board of Directors.  Of the 
options granted, 50% of the shares under each option are exercisable after 
two years from the grant date, 75% in three years, and 100% in four years.  
Options covering 208,123, 79,303 and 55,371 shares were exercised in 1994, 
1995, and 1996, respectively.  Options covering 219,600, 388,354 and 696,609 
shares were exercisable at December 31, 1994, December 30, 1995, and December
28, 1996, respectively.  Options covering 412,018 and 202,963 shares were 
canceled in 1995 and 1996, respectively. 

     The Company has adopted the disclosure provisions of Statement 
of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation."  The Company will continue to account for stock option 
awards in accordance with APB Opinion No. 25.  Had compensation cost for 
the Plan been determined based on the fair value at the grant date for 
awards in 1995 and 1996 consistent with the provisions of SFAS No. 123, 
the Company's net earnings and earnings per share would have been reduced 
to the pro forma amounts indicated below:

                                               1995          1996
As Reported:                                   ----          ----

Net Earnings                                 $(1,520)       $3,480
                                             =====================
Earnings per share                            ($0.07)       $ 0.17
                                             =====================
Pro Forma: 

Net Earnings                                 ($1,769)       $3,163
                                             =====================
Earnings per share                            ($0.09)       $ 0.15
                                             =====================

     The fair value of each option grant is estimated on the date of grant
using the Black - Scholes option - pricing model with the following 
weighted average assumptions used for grants in 1995 and 1996: dividend
yield of 0.0%; expected volatility of 86%; risk free interest rates
of 6.7% (1995) and 5.9% (1996); and expected lives of 4.34 years.

     At December 31, 1996, 1,643,357 options were outstanding at exercise
prices ranging from $0.44 to $7.88, with a weighted average remaining 
contractual life of 4.32 years, of which 464,485 options are currently
exercisable at a weighted average price of $6.24 per share.  Additionally, 
426,809 options were outstanding at exercise prices ranging from $10.75 
to $21.38 with a weighted average remaining contractual life of 2.68 
years, of which 232,124 options are currently exercisable at a weighted
average price of $16.74 per share.



                                    Page 42 of 58<PAGE>
<PAGE>
Principal Shareholder Transactions

     Effective in 1990, the Vice-Chairman (then the Chairman) of the 
Company (the "Vice- Chairman") granted two options (the "Vendor Options") 
covering an aggregate of 239,922 shares of Common Stock owned by him to 
two principals of one of the Company's vendors.  The exercise price for 
these options was $0.22 per share, the fair market value of the shares 
as of the date of grant.  One option terminated in 1996.  The other 
option (which covers 159,948 shares) vests over a four-year period and 
expires in 1997.

     On November 13, 1990, in consideration of the services rendered by 
two principals (each, an "Optionee") in two companies recruiting 
optometrists for the Company (Notes 8 and 15), the Vice-Chairman entered 
into option agreements (the "Option Agreements") which granted each 
Optionee the option (the "Option") to acquire from the Vice-Chairman 
683,775 shares of Common Stock, 384,750 shares of which were granted on 
November 13, 1990 exercisable for no cash consideration, and 299,025
shares of which were granted on February 14, 1991 with an exercise price 
of $0.22 per share, plus accrued interest.  The Vice-Chairman 
permitted each Optionee to partially exercise the Option (for no 
consideration) in August 1992 with respect to 136,755 of the shares 
subject to the Option.  There remained 547,020 shares of Common Stock under
each Option (all such shares, collectively, the "Option Shares").  In 1993, 
the Company filed with the Securities and Exchange Commission (the 
"Commission") a registration statement (the "Registration Statement") 
on Form S-3 pursuant to which (a) the transfer of the Option Shares 
from the Vice-Chairman to each Optionee and (b) the potential sale of 
certain of the Option Shares by each Optionee, was registered with the 
Commission.  Each Optionee exercised the Option immediately upon the 
effective date of the Registration Statement in the second quarter of 1994.  

     Upon the exercise of all the Options, the Company became entitled to 
a tax benefit valued at approximately $4.1 million, which is equal to the 
number of Option Shares multiplied by the difference between the market price 
of the Option Shares as of the date of exercise and the exercise price for 
the Option Shares, adjusted for the impact of tax rates.  The tax benefit 
will be treated as a contribution to capital and will have no impact on 
earnings for financial reporting purposes.  The timing and the amount of 
the benefit from the tax deduction will depend on future earnings of the 
Company.  The Company has recorded a valuation allowance against the tax 
benefit.  The foregoing tax consequences would also apply upon the exercise 
of the remaining Vendor Option.  The Company has received a deficiency notice 
from the Internal Revenue Service with respect to the tax benefit the
Company expects to realize from the exercise of the Options.  (See Note 9.)

Preferred Stock

     The Company is authorized to issue up to 5,000,000 shares of preferred 
stock, par value $1 per share, with such terms, characteristics and 
designations as may be determined by the Board of Directors.  No such 
shares are issued and outstanding.  In January 1997, the Company adopted
a shareholder rights plan.  (See Note 15.)


                                    Page 43 of 58<PAGE>
<PAGE>
6.  LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS

     Long-term debt and capital lease obligations at December 30, 1995 and 
December 28, 1996 consisted of the following (all amounts except monthly 
loan installments and interest rates in 000's):

<TABLE>
<CAPTION>
                                                                                             1995             1996
                                                                                             ----             ----

     <S>                                                                                   <C>              <C>
     Borrowings under revolving credit facility,                                  
       aggregate outstanding balance due for repayment
       in May, 1998                                                                        $38,000          $26,500
     Capital lease obligations with a related lease finance 
       company, due in aggregate monthly installments of 
       $38,000, including imputed interest at 14% per annum                                    322                 
     Capital lease and other obligations, due in aggregate monthly
       installments of $24,000, including imputed interest at
       rates of 9.9% to 19.5% per annum                                                        158                 
                                                                                           -------          -------
                                                                                            38,480           26,500
     Less current portion                                                                      480              -0-
                                                                                           -------          -------
                                                                                           $38,000          $26,500
                                                                                           =======          =======

</TABLE>

     The Company's capital lease obligations, which were secured by certain
equipment, furniture and fixtures with a net book value of $1,170,000 at
December 30, 1995, were extinguished in full during 1996.

     In November 1994, the Company entered into a syndicated $45 million 
three-year unsecured revolving credit facility.  The Company's credit 
facility (as amended) contains, among other covenants, a material adverse 
change clause, certain minimum net worth requirements, as well as a covenant 
which limits the ability of the Company to expand outside of its domestic 
Wal-Mart vision centers.  Commitment fees payable on the average daily 
balance of the unused portion of the line of credit were .30% per annum in 
1996.  The Company paid approximately $31,000, $32,000 and $40,000 in 
commitment fees in 1994, 1995 and 1996, respectively.  Interest on the 
outstanding advances is based on certain financial covenants and applicable 
interest rates for Eurodollar or base loan borrowings, as defined in the 
agreement.  In December 1996, the Company extended the facility until May 
1998.

                                    Page 44 of 58<PAGE>
<PAGE>
     In December of 1994, the Company paid $173,000 in connection with an 
agreement to cap certain interest rates under its credit facility up to 
$15 million.  The agreement caps LIBOR at 7.5% per annum unless the 
LIBOR rate is above 9% per annum in which case the protected rate is 9% 
per annum.  The cap agreement expires in February 1997.  In 1995, the 
Company entered into a two-year interest rate swap agreement (with a 
term expiring on February 20, 1998) which effectively converts underlying 
variable rate debt based on LIBOR to fixed rate debt.  The notional 
principal amount is $20 million, with an effective fixed rate of 7.305%. 
The fair market value of the fixed rate hedge approximates book value.

     As of December 28, 1996, the Company had borrowed $26.5 million under 
its credit facility at a weighted average interest rate of 7.38%.  The 
aggregate fair value of the Company's long-term debt and capital lease 
obligations is estimated to approximate their carrying value.


7.  RELATED-PARTY TRANSACTIONS

     The Company purchased and leased certain furniture and fixtures from 
a company which was owned by the spouse of the Vice-Chairman, who was 
also a member of the Company's board of directors until her resignation 
in March 1992.  On November 3, 1992, the furniture and fixtures company 
was sold to an unrelated party, which made installment payments to the 
spouse of the Vice-Chairman.  Until 1996, the Company purchased furniture 
and fixtures from this company.  In the opinion of management, such purchases 
were on an arms-length basis.  The aggregate amount of purchases of furniture 
and fixtures was approximately $3.9 million and $2.4 million in 1994 and in 
1995, respectively.  In 1991, certain amounts due to the furniture and 
fixture company were assigned to a lease finance company which is owned by 
another shareholder/director of the Company.  The Company made lease 
payments (including principal and interest) of $455,000, $417,000, and 
$341,000 to this lease finance company in 1994, 1995, and 1996, respectively. 
Such lease was paid in full as of September, 1996.

     During 1994, 1995, and 1996, the Company purchased its business and 
casualty insurance policies through an insurance agency in which a 
shareholder/director has a substantial ownership interest.  Total 
premiums paid for policies acquired through the insurance company during 
1994, 1995, and 1996 were approximately $1.3 million, $910,000, and 
$844,000, respectively.  The Audit Committee of the Company's Board 
of Directors has approved such purchases.

     In 1993, the Company executed a lease (the "Airplane Lease") with 
a company wholly owned by the Vice-Chairman.  In 1994, the Company 
made $26,000 in payments under the Airplane Lease.  The Audit 
Committee had approved the Airplane Lease, which was terminated in 
November 1994.


                                    Page 45 of 58<PAGE>
<PAGE>
8.  COMMITMENTS AND CONTINGENCIES

Noncancelable Operating Lease and License Agreements

     As of December 28, 1996, the Company is a lessee under noncancelable 
operating lease agreements for certain equipment which expire at various 
dates through 1998.  Additionally, the Company is required to pay its 
host department store companies minimum and percentage license fees.

     Effective December 20, 1991, the Company entered into a lease agreement 
with Wal-Mart for approximately 66,000 square feet of corporate office space. 
The term of the lease is ten years with a renewal option of seven years.  
The Company paid Wal-Mart approximately $215,000 annually in rental fees in 
1994, 1995, and 1996.    

     Effective July 1995, the Company entered into an operating lease for 
a computer equipment upgrade that provides processing for the newly 
installed management information and financial systems.  The term of the 
lease is three years.  Lease expense is approximately $8,000 monthly.

     Effective the first quarter, 1996, the Company entered into operating 
leases for 34 vehicles.  The terms of the leases are cancellable by the 
Company at any time, but the Company expects to retain the leases for three
years.  Lease expense is approximately $13,800 monthly.

     Under the lease for its Los Angeles laboratory, the Company paid 
$99,000, $102,000, and $101,000 in rental fees in 1994, 1995, and 1996,
respectively. 

     Aggregate future minimum payments under the license and lease 
arrangements are as follows (amounts in 000's):

              1997                        $16,389
              1998                         16,360
              1999                         16,078
              2000                         14,347
              2001                         11,529
              Thereafter                   17,052
                                          -------
                                          $91,755
                                          =======

     Total expenses recognized under these license and lease arrangements 
were approximately $10.1 million, $17.0 million, and $19.9 million for the 
years ended December 31, 1994, December 30, 1995, and December 28, 1996,
respectively.


                                    Page 46 of 58<PAGE>
<PAGE>
Gitano and Guy Laroche Trademark Licenses

     The Company has separate license agreements with Gitano, Inc. and 
Guy Laroche of North America, Inc., giving the Company the right to use 
the trademarks "Gitano" and "Guy Laroche", respectively, in its vision 
centers in North America.  Each agreement requires the Company to pay 
minimum and percentage royalties on retail and wholesale sales.

     The Gitano agreement expires on June 30, 1997 and the Guy Laroche 
agreement expires on December 31, 1998.  Each agreement may be renewed, 
subject to various conditions.  Under the Gitano agreement, the Company 
paid $97,000, $142,000, and $111,000 in fees during 1994, 1995, and 1996,
respectively.  Under the Guy Laroche agreement, the Company paid $100,000, 
$200,000, and $250,000 in fees during 1994, 1995, and 1996, respectively.

Consulting and Management Agreement 

     Among other things, the Wal-Mart Agreement (Note 3) requires an 
independent, licensed optometrist to practice adjacent to or near each of 
the Company's vision centers for at least 48 hours per week.  The Company 
entered into a consulting and management service agreement, as 
amended, with two companies jointly owned by two shareholders to 
recruit such optometrists for certain of its vision centers.  Subject
to applicable state regulations, this agreement, among other things, 
requires the Company to provide space and certain equipment to the 
optometrists and requires the recruiting entities to pay to the Company 
certain amounts as defined in the agreement.  The Company received 
$2.6 million, $2.5 million, and $2.9 million pursuant to this agreement 
during 1994, 1995, and 1996, respectively.  This agreement was terminated
in January, 1997.  (See Note 15.)

Employment Agreements

     Two executive officers are employed pursuant to employment agreements 
which provide for an annual salary and certain other benefits.  Each 
agreement further provides that the Company may at any time terminate 
the executive's employment upon six months notice or upon no notice if 
such termination is for cause, as defined.  



                                    Page 47 of 58<PAGE>
<PAGE>
     There are agreements between the Company and six of its executive 
officers which provide severance benefits in the event of termination of 
employment under certain circumstances following a change in control of 
the Company (as defined).  The circumstances are termination by the Company 
(other than because of death or disability commencing prior to a threatened 
change in control (as defined), or for cause (as defined), or by the officer 
as the result of a voluntary termination (as defined).  Following any such 
termination, in addition to compensation and benefits already earned, the 
officer will be entitled to receive a lump sum severance payment equal to 
up to three times the officer's annual rate of base salary.  The term of 
each agreement is for a rolling three-years unless the Company gives notice 
that it does not wish to extend such term, in which case the term of the 
agreement would expire three years from the date of the notice.


9.  INCOME TAXES

     The Company accounts for income taxes under Statement of Financial 
Accounts Standards (SFAS) No. 109 "Accounting for Income Taxes," which 
requires the use of the liability method of accounting for deferred income 
taxes.  The components of the net deferred tax assets/(liabilities) are as 
follows (amounts in 000's):

<TABLE>
<CAPTION>
                                                        As of December 30,                    As of December 28,
                                                               1995                                  1996  

<S>                                                           <C>                                  <C>
Total deferred tax liabilities                                $(5,460)                             $(6,347)
Total deferred tax assets                                      11,235                               10,658
Valuation allowance                                            (5,775)                              (5,543)
                                                              -------                              -------
Net deferred tax assets (liabilities)                         $     0                              $(1,232) 
                                                              =======                              =======


</TABLE>




                                    Page 48 of 58<PAGE>
<PAGE>
     The sources of the difference between the financial accounting and tax 
basis of the Company's liabilities and assets which give rise to the deferred 
tax liabilities and deferred tax assets and the tax effects of each are as 
follows (amounts in 000's):

<TABLE>
<CAPTION>
                                                        As of December 30,                    As of December 28,
                                                               1995                                  1996 
                                                               ----                                  ----

<S>                                                           <C>                                 <C>
Deferred tax liabilities:
  Depreciation                                                $ 5,305                             $ 6,062
  Store preopening costs                                          155                                  91
  Other                                                                                               194
                                                              -------                             -------
                                                              $ 5,460                             $ 6,347
                                                              =======                             =======

Deferred tax assets:
  Accrued expenses and reserves                               $ 1,496                             $ 1,471
  Inventory basis differences                                     524                                 326
  Net operating loss carryforwards                              9,182                               8,650
  Other                                                            33                                 211
                                                              -------                             -------
                                                              $11,235                             $10,658
                                                              =======                             =======
</TABLE>

     The consolidated provision for income taxes consists of the following 
(amounts in 000's):

<TABLE>
<CAPTION>
                                                                                     Year Ended
                                                           -------------------------------------------------------------
                                                           December 31,              December 30,           December 28,
                                                               1994                      1995                   1996
                                                               ----                      ----                   ----

<S>                                                            <C>                       <C>                    <C>
Current:
  Federal                                                                                $ 50                   $  135
  State                                                        $40                         50                       63
                                                               ---                       ----                   ------
                                                                40                        100                      198
                                                               ---                       ----                   ------
Deferred:
  Federal                                                                                                          897
  State                                                                                                            105
                                                               ---                       ----                   ------
                                                                 0                          0                    1,002
                                                               ---                       ----                   ------
Total provision for income taxes                               $40                       $100                   $1,200
                                                               ===                       ====                   ======
</TABLE>

                                    Page 49 of 58<PAGE>
<PAGE>
     The tax expense (benefit) differs from the amounts resulting from 
multiplying income before income taxes by the statutory federal income tax 
rate for the following reasons (amounts in 000's):

<TABLE>
<CAPTION>
                                                     Year Ended December 31,         December 30,           December 28,
                                                               1994                      1995                   1996
                                                               ----                      ----                   ----

<S>                                                            <C>                       <C>                    <C>
Federal income tax at statutory rate                           $   133                   $(483)                 $1,591
State income taxes, net of federal income 
   tax benefit                                                      40                      50                      69
Foreign losses not deductible for U.S. 
   federal tax purposes                                          1,076                     686                      63
Valuation allowance for U.S. state and
   federal taxes                                                (1,241)                   (181)                   (556)
Other                                                               32                      28                      33
                                                                ------                   -----                  ------
                                                                $   40                   $ 100                  $1,200
                                                                ======                   =====                  ======

</TABLE>

     At December 28, 1996, the Company had a valuation allowance of $5.5 
million due to the uncertainty regarding the realizability of its net 
operating loss carryforwards.  A portion of the net operating loss 
carryforward deferred tax asset (approximately $4.1 million) relates 
to tax benefits (subject to the outcome of the audit discussed below) 
from the exercise of stock options granted by the Vice Chairman to two 
shareholders who own consulting companies which recruited optometrists for 
the Company (Note 5).  No compensation expense was recorded for financial 
reporting purposes as there was no difference between the fair market 
value and the option price of the shares at the date of grant.  This 
benefit will be recorded as an addition to paid-in-capital (and a 
reduction in the valuation allowance) when realized.

     At December 28, 1996, the Company had U.S. regular tax net operating 
loss carryforwards of $27 million (of which approximately $10.7 million 
relates to the tax benefits from the exercise of stock options discussed 
above) and alternative minimum tax net operating loss carryforwards of 
approximately $3.9 million which can reduce future federal income taxes.  
If not utilized, these carryforwards will expire beginning in 2007.  

     At December 28, 1996, the Company had foreign tax net operating 
loss carryforwards in excess of $4.7 million which are available to reduce 
future foreign income taxes relative to the operations in Mexico and 
Eastern Europe.  If not utilized, these carryforwards will expire 
beginning in 1997.


                                    Page 50 of 58<PAGE>
<PAGE>
     As a result of an examination by the Internal Revenue Service ("IRS")
of the Company's 1992 tax return, the Company received a deficiency notice 
from the IRS, challenging the tax benefit relating to the exercise of 
stock options referred to above.  The Company has filed a petition in the 
U.S. Tax Court, contesting the deficiency notice.  The Company does not 
expect that the outcome of this proceeding will have a material adverse
impact on the financial statements or conditions of the Company.


10.  NET INCOME (LOSS) PER COMMON SHARE

     Net income (loss) per common share is computed based on the weighted 
average number of common stock and stock equivalent shares outstanding 
during the period.  Except when anti-dilutive, options for the purchase 
of common stock have been included as exercised (using the treasury stock 
method) as of the date of grant.  Common stock equivalents have been 
excluded from the calculation of weighted average shares outstanding 
during 1995, as the effect would be anti-dilutive.  The weighted average 
number of common shares outstanding used in the calculation is as follows:

<TABLE>
<CAPTION>
                        Year Ended December 31,     December 30,        December 28,
                                 1994                   1995                1996
                                 ----                   ----                ----
<S>                         <C>                     <C>                 <C>
Weighted average 
  number of shares 
  outstanding               20,665,257              20,537,799          20,706,629
                            ==========              ==========          ==========

</TABLE>

11.  SUPPLEMENTAL CASH FLOW INFORMATION

     Supplemental cash flow information is as follows (amounts in 000's):

<TABLE>
<CAPTION>
                        Year Ended December 31,     December 30,        December 28,
                                 1994                   1995                1996
                                 ----                   ----                ----
<S>                             <C>                 <C>                 <C>
Cash paid for-
  Interest                      $1,548              $2,750              $2,565
  Income taxes                      64                 244                 149

</TABLE>


                                    Page 51 of 58
<PAGE>
<PAGE>


12.  SELECTED QUARTERLY FINANCIAL DATA

     Selected quarterly data for the Company for the years ended December 30, 
1995 and December 28, 1996 is as follows  (amounts in 000's except per share 
information):

<TABLE>
<CAPTION>


YEAR ENDED DECEMBER 30, 1995:
                                                                                  Quarter Ended   
--------------------------------------------------------------------------------------------------------------------------------
                                                        April 1             July 1            September 30          December 30
                                                        -------             ------            ------------          -----------
<S>                                                     <C>                 <C>                  <C>                  <C>
Net Sales                                               $37,168             $35,725              $37,733              $34,947 
Cost of Goods Sold                                       16,714              16,586               17,861               16,805 
                                                        -------             -------              -------              -------
Gross Profit                                             20,454              19,139               19,872               18,142 
Selling, General, and
 Administrative Expenses                                 18,734              17,314               18,487               19,855 
Provision for Disposition of Assets (a)                                                            1,111                 (153)
Other Nonrecurring Charges (a)                                                                       900                  153 
                                                        -------             -------              -------              -------
Operating Income (Loss)                                   1,720               1,825                 (626)              (1,713)
Other Expense, Net                                          551                 775                  619                  681 
                                                        -------             -------              -------              -------
Income (Loss) Before Income Taxes                         1,169               1,050               (1,245)              (2,394)
Income Tax Benefit/(Provision)                             (332)               (240)                 372                  100 
                                                        -------             -------              -------              -------
Net Income (Loss)                                       $   837             $   810              $  (873)             $(2,294)
                                                        =======             =======              =======              =======
Net Income (Loss) Per Common Share                      $  0.04             $  0.04              $ (0.04)             $ (0.11)
                                                        =======             =======              =======              =======
</TABLE>

(a)      At September 30, 1995, the Company recorded a provision of $1.1 
         million for the disposition of the Venture operations and recorded 
         other nonrecurring charges of $900,000 to reduce Company assets 
         held for disposition to management's estimate of their net realizable 
         value.  In the fourth quarter 1995, the Company recorded a gain of 
         $491,000 relative to the sale of its French operations, which was
         offset by additional provisions relative to the disposition of the 
         Venture operations, the Aurrera store closures in Mexico, and the 
         net realizable value of other assets held for sale.  (See Note 13.)




                                    Page 52 of 58<PAGE>
<PAGE>
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 28, 1996:
                                                                                  Quarter Ended
--------------------------------------------------------------------------------------------------------------------------------
                                                        March 30            June 29           September 28          December 28
                                                        --------            -------           ------------          -----------
<S>                                                     <C>                 <C>                  <C>                  <C>
Net Sales                                               $40,133             $40,525              $41,347              $38,371 
Cost of Goods Sold                                       18,724              19,133               19,684               19,151 
                                                        -------             -------              -------              -------
Gross Profit                                             21,409              21,392               21,663               19,220 
Selling, General, and
 Administrative Expenses                                 19,386              19,202               19,679               18,653 
                                                        -------             -------              -------              -------
Operating Income                                          2,023               2,190                1,984                  567 
Other Expense, Net                                          659                 507                  453                  465 
                                                        -------             -------              -------              -------
Income Before Income Taxes                                1,364               1,683                1,531                  102 
Provision for Income Taxes                                  373                 431                  321                   75
                                                        -------             -------              -------              -------
Net Income                                              $   991             $ 1,252              $ 1,210              $    27 
                                                        =======             =======              =======              =======
Net Income Per Common Share                             $   .05             $   .06              $   .06              $    -- 
                                                        =======             =======              =======              =======
</TABLE>




                                    Page 53 of 58<PAGE>
<PAGE>

13.      DISPOSITIONS AND OTHER NONRECURRING CHARGES

     Sale of French Operations  

     On December 29, 1995, the Company sold its shares in IVACAR, S.A., its 
French subsidiary, to Carrefour France, for the sum of 18,000,000 FF 
($3.7 million U.S.), paid in cash at the closing.  The initial sum was 
received the first business day of 1996.  In connection with this transaction, 
the Company recorded a gain of $491,000 in 1995.  Such gain was offset by 
the provisions discussed below.

     Sale of Venture Operations

     The Venture operations were disposed of in three separate transactions. 
In anticipation of the disposition of the Venture operations, a provision 
of $1.4 million was recorded in 1995 to reduce the net assets of the 
Venture operations to management's estimate of net realizable value.  
The three transactions are described as follows:

     A.   Chicago Locations.  On October 1, 1995, the Company agreed to 
          sell its six Chicago locations, including assets associated with
          the store locations, to Uhlemann Optical Company for notes in the 
          total amount of $614,000.  In connection with such transaction, 
          the Company agreed to lend the purchaser up to $200,000 for working 
          capital.  The transaction closed on October 26, 1995.

     B.   Texas Locations.  On January 4, 1996, the Company agreed to sell 
          its 11 Texas locations, including certain assets associated with
          the store locations, to Budget Opticals of America, Inc. for 
          a secured note in the amount of $256,000. The transaction closed 
          on January 6, 1996.

     C.   St. Louis Locations.  On January 12, 1996, the Company agreed to 
          sell its eight St. Louis locations, including certain assets 
          associated with the store locations, to Comprehensive Eyecare, Ltd.
          for secured notes in the amount of $752,000.  In connection with 
          such transaction, the Company agreed to lend the purchaser up to 
          $50,000 for working capital.  The transaction closed on January 14,
          1996.


                                    Page 54 of 58<PAGE>
<PAGE>
     In September, 1996, Comprehensive Eyecare, Ltd. settled its 
obligation at the net book value of the promissory notes recorded by the
Company under the terms of the sales agreement.  In the opinion of
management, the promissory notes outstanding from the Chicago and Texas
sales transactions are recorded at net realizable value.

     Net sales and operating losses for each operation (exclusive of 
disposition costs, allocated corporate overhead, interest and taxes) for 
each period presented is summarized as follows (000's):

                                              Venture                France

Year Ended December 28, 1996
    Net Sales                                 $    37                $   402 
    Operating Losses                          $   (81)               $  (240)

Year Ended December 30, 1995
    Net Sales                                 $ 2,257                $ 5,117 
    Operating Losses                          $(2,073)               $  (523)

Year Ended December 31, 1994
    Net Sales                                 $ 2,415                $ 2,417 
    Operating Losses                          $(2,071)               $(1,144)


     Investment in Czech Republic and Slovakia

     In 1995, the Company decided that it would pursue the disposition of its 
share of the joint venture.  A provision of $300,000 was recorded to reflect 
management's estimate of net realizable value of the Company's investment 
in such joint venture.

     Aurrera Store Closures

     In 1995, the Company decided to close 16 underperforming vision centers 
located in Aurrera stores.  The Mexican operations recorded a $346,000 
provision to reduce the assets in those locations to management's estimate 
of net realizable value and record separation costs for employees.  The 
Company closed six vision centers in February 1995 and the remainder in the 
first quarter 1996.

     Foreclosure Proceedings - Frame Manufacturer

     In February 1995, the Company foreclosed on its security interest 
covering the assets of CompuFrame, a frame manufacturer.  The Company 
recorded a provision of $400,000 to reduce the net carrying amount of assets 
held for sale to management's estimate of their net realizable value.  The 
remaining assets were liquidated in 1996.  

     The net assets of the Venture operations and the frame manufacturer 
have been classified as assets held for sale in the current asset section 
of the Company's balance sheet at December 30, 1995.  The dispositions 
were completed in 1996.  For purposes of the accompanying statements of cash
flows, the change in components comprising assets held for sale is reflected
in the original balance sheet classification.

                                    Page 55 of 58<PAGE>
<PAGE>
14.  FOREIGN AND DOMESTIC OPERATIONS

     The geographic distributions of the Company's sales, transfers between
geographic areas, identifiable assets, and operating income for the years 
ended December 31, 1994, December 30, 1995, and December 28, 1996 are 
summarized in the following table (amounts in 000's).  Transfers between 
geographic areas are generally at cost plus freight, duties, and transfer 
fees.  Identifiable assets include all assets associated with operations in 
the indicated geographic areas excluding intercompany receivables and 
investments.  Operating income (loss) for the geographic areas does not 
include allocated corporate overhead, interest, or taxes. 

<TABLE>
<CAPTION>
                                                      1994                 1995                1996 
                                                      ----                 ----                ----
<S>                                                 <C>                  <C>                 <C>
Sales:
  United States                                     $112,109             $136,633            $156,599
  International                                        7,286                8,940               3,777
                                                    --------             --------            --------
                                                    $119,395             $145,573            $160,376
                                                    ========             ========            ========
Transfers between geographic areas:                                        
  United States                                     $    588             $    361            $    211
                                                    ========             ========            ========
Identifiable Assets:               
  United States                                     $ 67,609             $ 74,060            $ 71,590
  International                                       10,003                7,177               2,674
                                                    --------             --------            --------
                  Total Assets                      $ 77,612             $ 81,237            $ 74,264
                                                    ========             ========            ========
Operating Income:           
  United States before other 
    nonrecurring charges                            $  3,825             $  4,642            $  7,376
  Other writeoffs and reserves                                             (2,156) 
                                                    --------             --------            --------
  United States                                        3,825                2,486               7,376
  International                                       (2,239)              (1,280)               (612)
                                                    --------             --------            --------
  Operating income                                  $  1,586             $  1,206            $  6,764
                                                    ========             ========            ========
</TABLE>


                                    Page 56 of 58<PAGE>
<PAGE>

15.  SUBSEQUENT EVENTS

     In January 1997, the Company completed various transactions related to 
its relationship with each of Eyecare Leasing, Inc., which had recruited
optometrists for the Company pursuant to a consulting agreement, and Stewart-
Phillips, Inc., which had recruited optometrists practicing adjacent to the 
Company's vision centers in California.  The transactions involved the 
termination of such consulting agreement and transfer of the responsibilities
of Stewart-Phillips, Inc. to a subsidiary of the Company.  The aggregate cost 
of the transactions was $4.6 million, which will be capitalized as an 
intangible asset and amortized over the remaining life of the store leases.  
The Company made a lump sum payment of $500,000 at closing and entered into 
promissory obligations for the balance, payable over a 12-year period at 
6.4% interest.  The transactions are not expected to have a material impact 
on the financial statements or condition of the Company.

     In January of 1997, the Company's Board of Directors approved a 
Shareholders Rights Plan.  The Rights Plan provides for the distribution of
one Right for each outstanding share of the Company's Common Stock held of
record as of the close of business on January 27, 1997 or that thereafter 
becomes outstanding prior to the earlier of the final expiration date of 
the Rights or the first date upon which the Rights become exercisable.  Each
Right entitles the registered holder to purchase from the Company one 
one-hundredth of a share of Series A Participating Cumulative Preferred
Stock, par value $0.01 per share, at a price of $40.00, subject to adjustment.
The Rights are not exercisable until ten calendar days after a person or 
group buys or announces a tender offer for 15% or more of the Company's 
Common Stock, or if any person or group has acquired such an interest, the
acquisition by that person or group of an additional 2% of the Company's
Common Stock.  In the event the Rights become exercisable, holders of Rights
would have the right to receive, upon exercise thereof at the then current 
exercise price of the Right, that number of shares of Common Stock (or, 
under certain circumstances, an economically equivalent security or securities 
of the Company) having a market value of two times the exercise price of the 
Right.  The Rights will expire on January 26, 2007, unless extended or unless 
either the Rights are earlier redeemed by the Company in whole, but not in 
part, at a price of $0.001 per Right, or the Rights are earlier redeemed.




                                    Page 57 of 58<PAGE>
<PAGE>
<TABLE>
<CAPTION>
                                       SCHEDULE II


                    NATIONAL VISION ASSOCIATES, LTD. AND SUBSIDIARIES
                            VALUATION AND QUALIFYING ACCOUNTS
               December 31, 1994, December 30, 1995, and December 28, 1996
                                         (in 000's)


                                                              Additions
                                                    ------------------------------
                             Balance at             Charged to          Charged to                             Balance at   
Description             Beginning of Period      Cash and Expense      Other Accounts       Deductions        End of Period 
-----------             -------------------      ----------------      --------------       ----------        -------------

<S>                              <C>                    <C>                                    <C>                   <C>
Year ended
December 31, 1994:
  Allowance for
  Uncollectible
  Accounts Receivable             $70                    $423                                   $240                $253 

Year ended
December 30, 1995:
  Allowance for
  Uncollectible 
  Accounts Receivable            $253                    $216                                   $130                $339     

Year ended 
December 28, 1996:
  Allowance for
  Uncollectible
  Accounts Receivable            $339                    $177                                   $163                $353


</TABLE>



                                    Page 58 of 58